Daily Market Trend Guide -- Tuesday, September 06, 2011 (Published in the morning before the Markets opened)

MARKET TREND FOR TODAY

The Markets yesterday ended the day with moderate losses, but at the same time  displayed high degree of resilience against global weakness on expected lines and in the process have formed a lower top and lower bottom on the Daily High Low Charts.

For today, the global cues continue to remain weak. This, along with lack of participation in the Markets is likely to keep the Markets in consolidation range.

For today, expect the Markets to open again on a moderately negative note and look for directions. Today, the Markets shall depend critically on the intraday trajectory that it forms along with the volumes to set the trend for today.

For today, since the Markets are expected to open on a moderately negative note, the levels of 5040 and 5075 are to act as resistance and the levels of 4785 and 4960 are expected to act as supports.

The RSI—Relative Strength Index on the Daily Chart is 44.5614 and it shows no negative divergence or failure swing and is therefore neutral. The Daily MACD is Bullish as it continues to trade above its signal line.

Yesterday’s session has remained a capped session with the Markets opening low, trading in a range and then recovering. Today also, post negative opening following the global cues, we are again expected to show some resilience and trade in a range with capped downside and high chances of recovery.

Open Interest in both NIFTY and Stock futures have shown addition in Open Interest indicating creation of fresh longs on selective basis.

All and all, with no triggers for the downside, it is advised to refrain from making fresh shorts in the Markets. Though downside may be used to make fresh purchases, that too should be done on highly selective basis as the Markets are expected to remain in a range. While continuing to protect profits at higher levels, cautious outlook is advised for today.

Milan Vaishnav,
Consulting Technical Analyst,
http://www.mymoneyplant.co.in/
+91-9825016331
milanvaishnav@mymoneyplant.co.in
milanvaishnav@yahoo.com