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Markets continued to correct a bit and consolidate yesterday on average volumes to close with modest losses after coming off from its opening lows on expected lines and in the process have formed a lower top and lower bottom on the Daily High Low Charts.
For today, tough we may see the respite from the weakness that we saw, we also expect the overall consolidation to continue with an overall up ward bias and this can also come on lower volumes.
For today, expect the Markets to open on a flat to mildly negative note and look for directions. The volumes and in the intraday trajectory that it forms during the day would be critical to enable the markets to further its gains. For today, the levels of 5590 and 5635 shall continue to act as resistance and the levels of 5530 and 5505 shall act as supports.
Again today, as in the last couple of sessions, all lead indicators continue to remain in place. The RSI—Relative Strength Index is 51.2303 and is neutral as it shows no negative divergence or failure swings. The Daily MACD is bullish as it continues to trade above its signal line.
Also, as predicted in our yesterday’s edition of Daily Market Trend Guide, the Markets spent the session in trying to recover after opening on the lowest note and this very clearly signifies positive consolidation. The FIIs too have remained net buyers in F&O Markets and both NIFY and Stock Futures have continued to add open interest Also, the NIFTY futures going into premium from discount shows discomfort at lower levels. All and all, stock specific activity would be seen with the Markets continuing to consolidate / correct on small note. Volatility and range bound movement will stay. It is advised to adopt stock specific selective approach while avoiding shorts. Positive optimism is advised for today.
Though on lower volumes, the Markets continued its up move yesterday as it ended the day with modest gains and in the process have continued to form a higher top and higher bottom on the Daily High Low Charts.
The Markets have risen 243 points or 4.47% in the previous five sessions and have closed near the resistance of its 100DMA levels of 5586 and this is likely to act as a temporary resistance at which the Markets are expected to consolidate.
For today, expect the Markets to have a negative opening following weak closing of US Markets and resultant weak Asian Markets. With the Markets expected to open on a negative note, the levels of 5560 and 5530 are likely to act as supports. On the upside, the levels of 5590, and 5630 shall continue to act as resistance. However, lead indicators continue to remain in place. The RSI—Relative Strength Index on the Daily Chart is 54.6526 and it does not show any negative divergence. It has reached its highest value in last 14-days which is BULLISH. The Daily MACD continues to remain positive as it trades above its signal line.
Having said this, the FIIs have remained net buyers in both Index and Stock Futures and NIFTY Futures have went on to add significant open interest. Also, there is no signal on the Charts that can trigger any major weakness. Since the Markets have closed near one of its resistance, it is likely to resist and consolidate before further up move. Thus, there are chances of only consolidation happening and thus with the expected lower opening, there are chances that we may see the Markets improve post weak opening given the technicals. It is advised to still strictly refrain from shorts, and given the intraday trajectory, selective purchases may be made. Overall, cautious optimism is advised for today.
After briefly reacting to the GDP growth numbers which came in lower than expected, the Markets staged a smart rally in the second half of the session to closed with robust gains and in the process have continued to form a higher top and higher bottom on the Daily High Low Charts.
Technically speaking, with the Markets closing at the high point of the day, it is likely to open in the positive and continue its up move, at least in the initial trade.
Thus, today, expect the Markets to open on a positive note and look for upward directions and will continue to remain dominated with the intraday trajectory that it forms.All lead indicators in the Markets continue to remain in place. The RSI—Relative Strength Index on the Daily Chart is 52.3944 and it does not show any negative divergence. It however has reached its highest value in last 14-days and it is thus BULLISH. The Daily MACD continues to remain positive as it trades above its signal line.
Also, with yesterday’s rise, the Open Interest has increased signifying that apart from short covering, also some fresh longs have been initiated which is a positive sign. The FIIs and DIIs have remained net buyers.
However, the levels of 5591 and the levels of 5635 may act as resistance at Close levels in form of 100 DMA and 50 DMA respectively. Also, there is a pattern resistance in form of a Double Top at 5605 levels. Thus, there are chances that after seeing a rise of 243 points from its lows the Markets may consolidate in the range of 5590-5635 levels and fresh up move can occur above 5635 levels. All and all, consolidation likely in the Markets. Any move past 5635 levels will bring in fresh rally and until then the consolidation is expected in a range. However, bias remains on the upside. Positive outlook is advised for today.
The Markets yesterday opened on a positive note on expected lines but also consolidated as expected and finally ended the day of typical consolidation with low volumes with negligible loss but in the process have continued to give a higher top and higher bottom on the Daily High Low Charts.
For today, the Markets are expected to open on a positive note and may trade in the positive at least in the intraday trade.
With the Markets expected to open on a positive note, two factors would decide if the Markets will continue with its up move or would continue to consolidate. That would be the intraday trajectory that the Markets would form post opening and the volumes, that have remained a concern over couple of day, especially yesterday when they were much below its average.
All lead indicators continue to remain in place. The RSI — Relative Strength on the Daily Chart is 45.5075 and is neutral as it shows no negative divergence or failure swings.
Daily MACD on the Daily Charts has given a fresh buy signal after almost 28 sessions as it has reported a positive crossover and it now trade above its signal line.
Apart from the above reading, further OI in stock and Nifty futures have been added with thewidening of discount. This also suggest some addition of short positions but widening of discount without much fall also suggest discomfort at lower levels.
All and all, there is no consensus on the down side but at the same time, Markets lacks conviction to move up, though the bias continues to remain on the upside given the technicals and F&O Data. It is advised to continue to maintain stock specific approach making selective purchases strictly avoiding shorts. Positive optimism is advised for today.
The Markets continued its up move on Friday too as ended the day with gains on the second day in a row to end the week flat with net loss of just 10 points and in the process have continued to form a higher top and higher bottom on the Daily High Low Charts.
For today, expect a flat to positive opening in the Markets. With the Markets expected to open on a flat to positive note, the levels of 5520 and 5565 shall act as resistance and the levels of 5450 and 5430 shall act as support.
All lead indicators point towards potential confirmation of attempted reversal of the Markets. The RSI -- Relative Strength Index on the Daily Chart is 45.7192. RSI has reached its highest value in last 14-days which is BULLISH. Also, RSI has set a new 14-day high but NIFTY has still not, which is BULLISH DIVERGENCE. The Daily MACD however continues to trade below its signal line but is likely to give a buy signal given the continuation of the trend.
On the Weekly Charts, the RSI is 44.1693 and is neutral as it shows no negative divergence or failure swings. On the Candles, A Hammer occurred. Hammers appear after a significant decline or if the Security is Oversold, which is the Case is NIFTY (i.e. significant decline) to be valid. This usually indicates formation of support level and is thus considered a bullish pattern. Also, A Handing Man occurred. Since this has occurred after a downtrend, which is the case with NIFTY, it is called a Bullish Hammer.
Given this reading, the volumes continue to remain a concern and thus we will need continued and increased participation in the markets to capitalize on the above readings. Given the F&O Data, the NIFTY and Stock futures have continued to add Open Interests.
All and all, the Markets have limited downside this week with overall bias remaining towards upside. It is strictly advised to refrain from shorts and continue to make selective purchases. Even if we see some consolidation for a day or two, the over all bias remains on the upside.