MARKET TREND FOR TODAY
June 8, 2012
Though with an intra-session reluctance, the Markets
continue it up move for the fourth day in a row as it ended the day with
extended gains. The Markets opened modestly positive and after trading with
capped gains, pared most of its gains and at one moment traded modestly
positive. It corrected itself intraday from the minor double top resistance but
thereafter saw the recovery again in the second half of the session and went on
to give its day’s high of 5059.65, just a few points from its 200-DMA, the
level which it was expected to resist. It ended the day at 5049.65, posting a
net gain of 52.55 points or 1.05%. It formed a higher top and higher bottom on
the Daily High Low Charts.
The Markets are expected to open moderately lower and
consolidate a bit after rising over 275 points from the day’s low on 4th
June, and it would not be a surprise if we see minor retracement. Further, the
Markets have resisted precisely to the 200-DMA and there are chances that the
Markets consolidates briefly around this level.
The levels of 5065 which is the 200-DMA and the level of
5092, which is the 50-DMA are likely to act as immediate resistance at Close
levels. The levels of 5010 and 4965 are immediate supports on the Charts.
All lead indicators continue to remain in place. The RSI—Relative
Strength Index on the Daily Chart is 56.0557 and it has reached its highest
value in last 14-days, which is bullish. It does not show any negative or
positive divergence. The Daily MACD continues to trade above its signal line
and is bullish.
Having said this, the chances of the Markets consolidating
or showing minor retracements cannot be ruled out. There are chances that the Markets consolidates again
with the levels of 5065 and 5092 acting as resistance and thus, we may see some
range bound movements and also a tinge of volatility returning to the Markets.
It is important to note that these levels should be used for protecting profits
but certainly not the opportunity for fresh shorts.
All and all, range bound session likely and some volatility
is likely to be seen. Chances of consolidation are seen in the Markets and any
downside should be utilized to make very selective purchases. Intermittent
profit taking bouts cannot be ruled out. Existing profits should be protected
at higher levels. Overall, cautious optimism is advised for today.
Milan
Vaishnav,
Consulting
Technical Analyst,
+91-98250-16331
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