MARKET TREND FOR
TODAY
August 9, 2012
Yesterday, the Markets traded almost in line with what was
analyzed in our yesterday’s edition of Daily Market Trend Guide. On expected lines,
the Markets opened positive, though volatile but remained positive but also saw
some bouts of profit taking towards the end to end the day closing absolutely
flat paring all of its gains. The Markets during the day touched the intraday
high of 5377.60. However, after volatile movement in the intraday 25-odd point
range, the Markets gave off all of its gains towards the end of the day and
Closed at 5338.00, posting a negligible gain of 1.30 points or 0.02%. The
volumes too remained around average. The Markets have, however, formed a higher
top and higher bottom on the Daily High Low Charts.
Today’s analysis remains more or less similar than that of
yesterday. Today also, we expect a moderately positive opening in the Markets
but, at the same time, also foresee some minor correction / consolidation
setting in, whose basic signs have started appearing yesterday with fall in net
open interest in stock futures.
For today, the levels of 5360 and 5385 are immediate resistance
levels and the levels of 5290 and 5235 are immediate supports.
The RSI—Relative Strength Index on the Daily Chart is 63.4662
and it has reached its highest value in last 14-days which is bullish. It does
not show any positive or negative divergence. The Daily MACD continues to trade
above its signal line.
However, on the Candles, A
Long Upper Shadow has occurred. This is a typically bearish signal,
potentially, especially when it occurs after a rally or near the highs or near
resistance levels.
Further to this, though NIFTY futures have added in net open
Interest, the Stock futures have shed 1.23 crore share in total open interest.
This too shows a moderate sign of possible consolidation / minor correction.
Having said all this, we can expect a moderately positive
start to the Markets but there are continuing chances that, like yesterday, we
see some volatile movement and some intermittent bouts of profit taking.
All and all, it is advised to continue to refrain from
taking aggressive positions on either side and keep protecting profits at
higher levels on the long side. Further, while taking fresh positions on either
side, ultra selective approach is advised. Cautious outlook is advised for
today.
Milan
Vaishnav,
Consulting
Technical Analyst,
+91-98250-16331
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