MARKET TREND FOR TODAY January 24, 2012
The session yesterday remain precisely as analysed as the Markets consolidated near the mentioned resistance levels and ended the day flat. The Markets opened on a negative note but soon moved into the positive territory and gave its intraday high of 5059.55. Thereafter, it spent the entire session in a very capped and narrow range and in between kept moving in and out of the positive territory. The Markets spent the entire session in a consolidating sideward movement and finally ended the day at 5046.25, posting a net loss of 2.35 points or 0.05%. In the process, it formed a parallel bar on the Daily High Low Charts, forming a similar top and similar bottom.
For today, we can expect the consolidation to continue and thus, the analysis for today remains more or less similar to what was carried out yesterday. For today, expect the Markets to open on a mildly positive note and look for directions. It is expected to open mildly positive and trade in a capped range, at least in the initial trade.
Today, RBI is set to announce its Monetary Policy and the Markets shall react to that. The overall Markets remain divided on the CRR cuts and thus, we may see the Markets reacting sharply to it either way, though there are equal chances of it remaining a non-event. Further to this, just two sessions remain for expiry and thus, we would also see the session dominated with rollover centric activities today also.
For today, the levels of 5100 remains an important resistance and the supports are expected at 5010 and 4970 levels. The RSI—Relative Strength Index is 67.99 on the Daily Charts and it is neutral as it shows no negative divergence or failure swings. The Daily MACD continues to remain bullish as it trades above the signal line.
As indicated above, the rollover centric activities to continue. Both NIFTY and Key Stocks have reported rollovers in excess of 50% so far and the NIFTY PCR remains at 1.61. Any upside in the NIFTY will make it nearly overbought and this keeps the broad analysis similar to that of yesterday. It is advised to avoid aggressive exposure on either side and continue to protect profits. Even though in case of any positive surprise with CRR cut, it is still advised to avoid aggressive long positions and protect profits at higher levels. Overall, cautious outlook is advised for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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