MARKET TREND FOR TODAY
May 24, 2012
The bleeding Rupee took the Markets take a further moderate
dip as the session remained absolutely volatile and directionless on expected
lines and the Markets, after spending the session going nowhere, ended the day
with moderate losses. The Markets opened negative and after trading in a capped
range, saw a bout of weakness as it gave its intraday low of 4803.95 in the
late morning session. The Markets saw a sharp recovery again, traded in a range
and gave up again. However, it saw some recovery again as it finally ended the
day at 4835.65, posting a loss of 24.85 points or 0.51%. It formed a sharply
lower top and lower bottom on the Daily High Low Charts.
The Markets are Oversold a gain and today, we can expect a
modestly positive opening in the Markets. The rise and quantum of rise in the
Petrol price would be sentimentally
positive and key would be to see it the Markets further capitalizes on the
positive opening that it is set to get today. The intraday trajectory would be
important.
The levels of 4880 and 4935 would act as immediate
resistance and the levels of 4810 and 4780 would act as immediate supports.
The lead indicators point towards some potential relief from
the current weakness. The RSI—Relative Strength
Index on the Daily Chart is 29.5454 and it does not show any failure swing. The
NIFTY has set a new 14-day low but the RSI has not and this is Bullish
Divergence. The Daily MACD continues to trade below its signal line.
Both NIFTY and Stock futures have added nominal Open
Interest with the FIIs remaining moderately net buyers in both F&O and Cash
segment.
Overall, there is no trend reversal or even a pullback as
yet, which we feel is long overdue. The Markets are oversold and we may see
some pullback from this levels today, but intraday trajectory would be equally
important to see if the Markets sustains these expected modest opening gains.
All and all, it is advised to continue to tread the Markets
on a cautious note. Aggressive positions should still be avoided and shorts
should be completely avoided. Adequate liquidity should be maintained to
protect existing positions and profits should be vigilantly booked at higher
levels. Volatility is going to stay. Overall, positive caution is advised for
today.
Milan
Vaishnav,
Consulting
Technical Analyst,
+91-98250-16331
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.