Friday, June 1, 2012
MARKET TREND FOR TODAY June 01, 2012
The sagging GDP numbers failed to deter the Markets after the initial weakness as the hopes of rate cuts overweighed the Markets as it ended the day after a smart recovery from the day’s low. The Markets opened negative following global weakness and traded absolutely in a capped range as it gave its day’s low of 4883.55 in the late morning trade before the Q4 GDP numbers came out. It stood 5.3% for the Quarter and 6.1% YOY. The Markets did react for a brief while to this. However, it thereafter transformed itself into a rising trajectory and recovered smartly from its day’s low and even went on to give the day’s high of 4949.25, recovering almost 65-odd points from its day’s low. It however ended the day at 4924.25, posting a net loss of 26.50 points or 0.54%. It has continued to form a lower top and lower bottom on the Daily High Low Charts.
Today’s session likely to remain volatile as well as the Markets are expected to open on a modestly negative note and look for directions. The global cues are not that bad and the technicals are neutral with little bias towards upside. The Markets will enter into new derivative series today digesting the GDP numbers.
The levels of 4960 and 4985 are immediate resistance and the levels of 4890 and 4855 are immediate supports on the Daily Charts.
The lead indicators still continue to remain in place with RSI—Relative Strength Index at 41.6444 and it does not show any negative divergence or failure swing and therefore, it is neutral. The Daily MACD is bullish as it still continues to trade above its signal line.
With average NIFTY and Market-wide rollovers completed in to June series, there is no statistical reason to worry. The Markets will have to fight more with the fundamental reasons and the overall technicals of the Markets suggest that it shall remain in a range and invariably volatile. The Markets have made a potential bottom on the 18th of May and the key would be to see if it reverses from current levels before reaching those May 18th lows and thereby making a higher bottom (a potential trend reversal from a pullback) or it testes those lows again. This phase would be highly volatile with major resistance coming in at 5020 levels and 5068, which is the 200-DMA.
All and all, the repeat of yesterday’s trend likely. Modestly lower opening cannot be ruled out. However, shorts may be strictly avoided as there are no such triggers and very selective stock specific approach is advised and profits should be continued to be protected. Overall, cautious approach, with tinge of optimism is advised for today.
Consulting Technical Analyst,
Thursday, May 31, 2012
MARKET TREND FOR TODAY May 31, 2012
A mixed felling of caution and pessimism weighed on the session yesterday ahead of expiry of the current derivative series and the coming out of Q4 GDP numbers as the Markets remained highly volatile during the entire trading hours and ended the day with losses. The Markets opened modestly negative in line with the Asian Markets and remained negative throughout the session in a very narrow 25-odd points range. At one point of time, the Markets recovered sharply from lower levels twice, but finally, towards the end of the session, pared all of its intermittent recovery bouts as it gave its day’s low of 4944.90. It finally ended the day at 4950.75, posting a net loss of 39.35 points or 0.79%. It has formed a lower top and lower bottom on the Daily High Low Charts.
Today being the expiry day, we are all likely to see the session continuing to remain dominated with heavy rollover centric activities. Further as a caution ahead of Q4 GDP Data and due to global weakness, we are also likely to see lower opening in the Markets today. The Markets shall open negative and thus intraday trajectory would be important as lot of shorts were again created in the Markets with the NIFTY futures discount widened.
Today, the levels of 4995 and 5030 shall act as immediate resistance and the levels of 4910 and 4875 shall act as support on the Charts.
The lead indicators still continue to remain in place. The RSI—Relative Strength Index on the Daily Chart is 43.9010 and it is neutral as it shows no negative divergence or failure swings. The Daily MACD continues to trade above its signal line and is therefore, bullish.
The NIFTY and Stock futures have continued to add significant Open Interest yesterday signifying addition in Open Interest. The NIFTY rollovers and Market-wide rollovers have been slightly lower than the previous series and thus, we may see total dominance of rollover centric activities today. Further to this, the Markets shall react to the Q4 GDP numbers that shall be announced later today.
All and all, the Markets shall open weak and trade in a range in the early session and then react to external news flow such as GDP Numbers, etc. There are chances that we see some recovery in the later part of the day. It is advised to remain highly selective and protect profits at higher levels. Cautious outlook is advised for today.
Consulting Technical Analyst,
Tuesday, May 29, 2012
MARKET TREND FOR TODAY May 29, 2012
The Markets had a pleasant session today, especially the later half as it saw the initial volatility but ended the day with decent gains. The Markets opened on a quietly positive note and traded with capped gains in the early session. The Markets did saw some intermittent volatility in the first half of the session while it continued to maintain gains. However, in the second half of the session, Markets saw itself getting stronger as the Markets went on to give the day’s high of 49994.95. It closed near the high point of the day at 4985.65, posting a decent gain of 65.25 points or 1.33% as it continued with its up move after a day’s consolidation. It has formed a slightly higher top and higher bottom on the Daily High Low Charts.
Today, we can expect the Markets to open initially on a flat note and then continue with the up move. The technical as well as external global factors support this. Technically speaking, the Markets are witnessing a successful pullback after the lows of 18th May. The volatility shall remain and intraday trajectory would continue to remain important.
For today, the levels of 5045 and 5070 which is the 200DMA for the Markets are immediate resistance levels and the levels of 4950 and 4910 are immediate supports on the Charts.
The lead indicators continue to show the undercurrent as buoyant. The RSI—Relative Strength Index on the Daily Chart is 46.9966 and it has reached its highest value in last 14-days which is bullish. It does not show any failure swing. The Daily MACD continues to remain bullish as it trades above its signal line.
The NIFTY and Stock Futures have continued to add open interest with the rise and this implies creation of fresh long positions in the Markets.
All and all, technically speaking, the uptrend is likely to continue though some consolidation during the day and intermittent bouts of volatility cannot be ruled out. Going purely by technical factors, the Markets should reach up to its 500-DMA levels of 5065-5070 and then consolidate. After that we will if it this is a pullback or if this translates into reversal of trend later. Stock specific activities would be seen. Any intermittent weakness can be used to make selective purchases while vigilantly protecting profits at higher levels. Overall, positive caution is advised for today.
Consulting Technical Analyst,
Monday, May 28, 2012
MARKET TREND FOR TODAY May 28, 2012
Despite mild weakness in the Global Markets the Indian Markets heavily consolidated with the upward bias on Friday as it ended the day almost flat without change. The Markets opened on a negative note and gave its intraday low of 4889.35 in the morning trade. The Markets thereafter saw some recovery from the day’s low and trade in the green. However, no runaway rise was witnessed as the Markets traded in extremely capped range as it gave its day’s high of 4835.80. The heavy consolidation continued as the Markets ended the day virtually unchanged at 4920.40 with net loss of just 1 Point. It formed a mildly higher to and sharply higher bottom on the Daily High Low charts.
Today, expect the Markets t o open on flat to mildly negative note and thus, consolidation is expected to continue. The Markets shall open and trade in a capped range, at least in the initial trade and consolidate with upward bias.
For today, the levels of 4960 and 5010 are immediate resistance levels and the levels of 4880 and 4850 are immediate supports on the Charts.
All lead indicators continue to remain in place. The RSI—Relative Strength Index on the Daily Chart is 40.0114 and it is neutral as it shows no negative divergences or failure swings. The Daily MACD is just reported a positive crossover as it now trades above its signal line and is therefore Bullish. On the Weekly Charts, the RSI 41.3950 and is neutral without showing any negative divergence or failure swings. The Weekly MACD still continues to trade below its signal line.
The Close reading of the Daily and Weekly Charts point toward continuation of consolidation in the Markets, but with the upward bias. The Markets will see some sustainable pullback once its moves past the levels of 4956-4960 levels, and until then it will consolidate.
Given the Pattern Analysis of the both, the Daily as well as the Weekly Charts, it clearly points towards continuation of consolidation initially and thus volatility shall continue to stay with the intraday trend remaining critically important.
All and all, the Markets have attempted to form a bottom and is in the process of a pullback. Given this condition on the Charts, it is strongly advised to avoid shorts and make selective cautious purchases while continuing to protect profit at higher levels. Positive caution is advised for today.
Consulting Technical Analyst,