MARKET TREND FOR
TODAY
August 23, 2012
The Markets had a very volatile session yesterday as it
opened and traded with capped losses defying weak global cues and just as it
seemed that it confirmed a breakout, pared all of its gains towards the end of
the session to end the day with nominal losses. The Markets opened negative but
losses remained heavily capped. In the second half of the session, the Markets
saw a sharp recovery and also went into the positive to give the day’s high of
2433.35. It pared all those gains equally fast in the last half hour of the
trade and finally ended the day at 5412.85, posting a nominal loss of 8.15
points or 0.15%. It has formed a slightly higher top and higher bottom on the
Daily High Low Charts.
Today’s session also likely to remain equally directionless,
range bound and volatile like that of yesterday as though the Markets have
managed to hang on above the levels of 5400, there has been no comprehensive
breakout with volumes. The intraday trajectory would therefore be critical as
it would dominate the trend for today.
The levels of 5425 and 5450 shall act as immediate
resistance and the levels of 5385 and 5365 shall act as immediate supports.
The RSI—Relative Strength Index on the Daily Charts is
67.0424 and it is neutral as it shows no negative divergence or failure swing.
The Daily MACD continues to trade above its signal line.
There has been net decrease in NIFTY Open Interest to the
extent of 2.57 lakh shares or 0.97%. This signifies long unwinding of NIFTY
from higher levels. So, the levels of 5433-5450 remains technical resistance
for the Markets.
As mentioned earlier, there is no comprehensive breakout as
the Markets moved past the 5400 levels and instead it is consolidating again
and yesterday it ended the quite off from its highs.
All and all, it is likely that consolidation continues in
the Markets and the Markets may find it difficult to remain above the levels of
5400. Even if it sees temporary rise like yesterday, there are equal amount of
chances that we see bouts of profit taking from higher levels. However, this
time, sectoral outperformance would be witness as the sectors like Pharma and
IT can outperform. However, very selective approach with protection of profits
at higher levels is advised for today.
Milan
Vaishnav,
Consulting
Technical Analyst,
+91-98250-16331
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