MARKET TREND FOR TODAY
October 09, 2012
The Markets saw quite perfect
correction which was long overdue as it opened moderately lower and then
deepened its cut in the later session to end the day with losses. The Markets
opened on a negative note as it give its intraday high of 5751.85 in the very
early seconds of the trade. Thereafter, it dipped in the negative territory and
remained in capped range. The Markets further deepened its losses in the second
half of the session as it went on to gave the day’s low of 5666.20. The Markets
did not recover as such at all and finally ended the day at 5676, posting a cut
of 70.95 points or 1.23%.
For today, expect the Markets to
open on a moderately positive note as a technical pullback is expected. Thus, a
moderately positive opening can be expected but at the same time, intraday
trajectory would be crucial as there are bright chances that the Markets
continue with their corrective performance post positive opening.
For today, the levels of 5710 and
5725 shall act as immediate resistance levels.
All lead indicators continue
towards impending weakness and the increased possibility of continued correction.
The RSI – Relative Strength Index on the daily chart is 61.0695 and it has just
given a “Sell” signal from OVERGOUGHT
range. RSI has also reached its lowest
value in last 14-days, which is bearish. Also, RSI has set a new 14-day low but
the NIFTY has not and this is Bearish Divergence.
Further to this, NIFTY has shed
80,000 shares in Open Interest and thus, in yesterday’s session , some long
unwinding has been observed.
Having said this, it is very much
likely that the Markets continue to remain in correction mode. There are bright
chances that the Markets opens firm and positive but gradually pare its gains
as the session progresses. In such case, intraday trajectory would continue to
remain crucial.
All and all, continuance of
cautious outlook is advised. Investors should not get carried away by a opening
up move and profits should be protected on long positions. The Markets may
continue to remain in corrective move, baring a day or two of up move. Aggressive
purchases may be avoided and cautious
outlook is advised for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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