MARKET TREND FOR TODAY
April 2, 2012
After dipping below its crucial 200-DMA on
Thursday but holding that support at Close, the Markets continued with their up
move on Friday as it opened positive, remained in rising trajectory for the
entire session and went on to end the day with decent gains. The Markets opened
on a positive note and remained in upward rising trajectory for the entire
session. It went on to give the intraday high of 5307.10 and ended the day at
5295.55, posting a decent gain of 116.70 points or 2.25%. It formed a sharply
higher top and higher bottom on the Daily Charts and has ended the week flat
with net gains of just 17.35 points or 0.38%.
For today, we can expect the Markets to
open on a flat to moderately negative note. The Markets are expected to
consolidate after Friday’s gains and thus intraday trajectory would continue to
remain important and crucial. The way Markets took supports at their 200-DMA,
it has closed near its 50-DMA and thus this level of 5312 is likely to act a
resistance at Close levels if the Markets consolidate its gains.
The levels of 5312 and 5365 are immediate
resistance on the Charts and the levels of 5250 and 5210 are immediate
supports. The volumes too would be
important to watch out for and are expected to be lower if the Markets
consolidates.
All lead indicators continue to remain in
place. The RSI—Relative Strength Index on the Daily Chart is 50.5086 and is
neutral as it shows no negative divergence or failure swings. The Daily MACD
continues to trade below its signal line. On the Weekly Chart, the RSI is
53.5388 and is neutral as it shows no negative divergence or failure swings.
The Weekly MACD continues to remain BULLISH as it trades above its signal line.
The NIFTY Futures have shown a nominal
decline in Open Interest and the Stock Futures have shown increase in Open
Interest. The overall rally on Friday can be translated as very sharp short
covering which was somewhat replaced with select buying and this trend is
expected to continue this week. The reading of Daily and Weekly indicators on
the Charts put this week’s trend as “Neutral to bullish”.
All and all, the Markets may consolidate
today and even this week, this being a very short week of just 3 working days.
This consolidation may keep the Markets in a capped range and usually volatile.
However, if the Markets consolidates, it is likely to keep the volumes low.
However, given all this, the bias remains on the upside as the overall
technicals remain intact. Shorts should be avoided and selective purchases may
be made. Overall, positive approach with some degree of caution is advised for
today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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