MARKET TREND FOR TODAY January 19, 2012
After a smart rally on Tuesday, the Markets took a breather yesterday as it spent the session on a consolidation note, taking supports precisely at the mentioned levels and ending the day on mildly lower note. The Markets opened positive, and gave its intraday high of 4980.65 in the morning trade. After trading briefly with capped gains, the Markets saw some correction coming in as it slipped into the red. It went on to give the low of 4931.05, taking support at its 100-DMA and recovered from those levels to end the day at 4955.80, posting a modest loss of 11.50 points or 0.23% and formed a slightly higher top and bottom on the Daily High Low Charts.
For today, we can expect the Markets to open on a positive and stronger note and continue with its up move that took some breather yesterday. The Markets are expected to open positive and continue with its up move at least in the initial trade. Today, the intraday trajectory that it forms, especially in the morning trade would be critically important to decide the trend for the rest of the day.
The levels of 4990 and 5055 are expected to act as resistance the levels of 4930 and 4890 are expected to continue to act as immediate supports.
All lead indicators continue to remain in place. The RSI—Relative Strength Index on the Daily Chart is 63.1725 and is neutral as it shows no negative divergence or failure swings. The Daily MACD remains bullish as it continues to trade above its signal line.
The above technical reading is supported by F&O statistics which shows addition of open interest in NIFTY Futures and the Open Interest across Stock futures remains unchanged. Given this, the Markets are technically better poised to continue with its up move.
All and all, buoyancy in today’s session can be expected. However, in event of Markets moving past the 5000-5030 levels , it would be prudent to avoid aggressive buying and protect existing profits at higher levels. In event of higher opening, it is advised to remain highly selective in making purchases and very vigilantly protect profits as just mentioned above, while strictly avoiding any major shorts. Overall, positive outlook is advised for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
milanvaishnav@yahoo.com
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