Friday, July 6, 2012
MARKET TREND FOR TODAY July 6, 2012
The Markets tried to further its up move towards the end of the session and made an attempt to give a positive break out as it ended the day with modest gains. The Markets opened flat and spent the most part of the session in a extremely narrow range moving in and out of the positive territory and traded for quite a long time around its previous close. However, again, it saw some action coming in as it saw some strength coming in the last hour and half of the trade. It spurt up a bit and gave its intraday high of 5333.65. This was against the resistance levels of 5325 mentioned by us today, as well as in last two of the previous editions. It slightly came off and finally ended the day at 5327.30, posting a modest gain of 24.75 points or 0.47%. The volumes remained around its average and the Markets formed a mildly higher top and higher bottom on the Daily High Low Charts.
Expect the Markets to open flat again and continue with the consolidation on the fifth day also and thus again continue to rely on the intraday trajectory that it shall form. The Markets are expected to open flat and look for directions , but this time, minor correction cannot be ruled out as indicated by the lead indicators.
The levels 5340 and 5385 are expected to act as resistance and the levels of 5280 and 5215 are expected to act as immediate supports.
The lead indicators and other factors paint a mix picture. The RSI—Relative Strength Index on the Daily Charts is 70.5307 and it has reached its highest value in last 14-days, which is bullish. But at the same time, it has entered its “Overbought” range. It does not show any positive or negative divergence. The Daily MACD remains bullish as it continues to trade above its signal line.
Along with the above mix reading of the lead indicators, the NIFTY futures have added over 6 lakh shares and the Stock Futures have added over 2 crores shares in Open Interest which indicates buoyant undercurrent. The NIFTY PCR stands at 1.22 which continues to leave a significant gap on the upside.
Despite the mix reading of the lead indicators which are short term technical indicators, it is important to note that the Markets have taken an overall good fundamental turn for the better. So, the Markets may consolidate a bit, or even if it sees minor correction in coming days, it would be on the contrary healthy for the Markets as it shall prepare itself for further up move.
All and all, consolidation ahead in the day likely. Some occasional bouts may also be seen and any short term downside may be used for making selective purchases, though keeping the outlook highly stock specific. Existing profits may be protected and shorts should be avoided. Overall, cautious optimism is advised for today.
Consulting Technical Analyst,
Thursday, July 5, 2012
MARKET TREND FOR TODAY July 5, 2012
The Markets attempted a positive breakout, though it did not achieved yet but ended the day with minor gains. The Markets opened on a positive note and gave the intraday high of 5317.65 in the early minutes of the trade. This was against the levels of 5325 mentioned by us. After giving this high, the Markets gradually drifted and in the afternoon trade and gave its intraday low of 5273.30. It however recovered in the in the last hour and half of the session and then traded in the positive territory, though in a capped range. It finally ended the day at 5302.55, posting a minor gain of 14.60 points or 0.28%. The positive consolidation continued as the Markets have formed a parallel bar on the Daily High Low Charts.
The Markets have continued to remain in consolidation phase and today’s analysis is going to be no different than what is being carried out since last 2-3 sessions. The Markets are expected to open on a flat to mildly negative note and look for directions. The consolidation shall continue and thus, again, the intraday trajectory would continue to remain important. The only difference being that the bias has shifted more towards upside with the Markets ending near the high point of the day.
The levels of 5325 and 5360 shall act as immediate resistance and the levels of 5275 and 5210 shall act as immediate supports.
All lead indicators point towards continuing upside and upward bias. The RSI—Relative Strength Index on the Daily Chart is 68.9433 and it has reached its highest value in last 14-days which is bullish. It does not show any negative divergence. The Daily MACD continues to remain bullish as it trades near its signal line.
The NIFTY and stock futures have continued to add open interest while the Rupee has continued to appreciate. The lead indicators too point towards upward bias and one more up move. At the same time, it is also important to note that given the value of lead indicators, there are high chances that we see one up move and the Markets continues to consolidate again or correct a bit.
All and all, the bias continues to remain towards up side. The intraday trajectory would continue to be important. Very selective buying should be done but at the same time, equal attention should be paid in exiting profit making positions. Profit protection at these levels would be equally important. Shorts and aggressive positions should be appropriate. Overall, positive caution is advised.
Consulting Technical Analyst,
Wednesday, July 4, 2012
MARKET TREND FOR TODAY July 4, 2012
The Markets in yesterday’s session continued to consolidate and remain flat for the second day in a row as it spent the session again in a very narrow range and ended the day with nominal gains. The Markets opened on a decently positive note and made their day’s high of 5317 in the very early part of the session. This was against the possible resistance levels of 5325 mentioned by us. It started drifting downwards and dipped into the red briefly in the second part of the session. It however, gradually recovered again to finally end the day at 5287.95, posting a nominal gain of 9.35 points or 0.18%. The volumes continued to hover around its average. The Markets have a higher top and a similar bottom on the Daily High Low Charts.
Today’s analysis remains more or less similar to that of yesterday as the Markets have continued to consolidate after a strong up move on Friday and the undercurrent remains buoyant. Today, we can again expect the Markets to open on a flat to mildly positive note and look for directions. Being in consolidation phase, the intraday trajectory would continue to remain critically important.
The levels of 5230 and 5272 are immediate resistance on the charts and the levels of 5245 and 5210 on the charts.
The lead indicators continue to remain in place. The RSI—Relative Strength Index on the Daily chart is 67.9991 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 remain bullish as it trades above its signal line.
The another factor that point towards the undercurrent remaining buoyant is the fact that apart from the NIFTY and the stock futures which have been adding Open Interest in the times of consolidation, the Rupee yesterday too appreciated pointing towards possibility of some more up move before the Markets consolidate again.
All and all, with the undercurrent remaining buoyant, the Markets will continue to consolidate but with upward bias. The volumes would be required for any sustainable upward move. Profit taking bouts cannot be ruled out but the movement will remain narrow and ranged while the Markets consolidates. Shorts should be strictly avoided as there are no triggers for this and undercurrent remains intact. Very selective and positive approach with protection of profit at higher levels is advised.
Consulting Technical Analyst,
Tuesday, July 3, 2012
MARKET TREND FOR TODAY July 3, 2012
Yesterday was a day of positive consolidation for the Markets as the Markets ended the day and refused to correct even after the robust gain on Friday. The Markets opened moderately positive and remained in a very narrow range until the early afternoon trade. It slipped a bit in the afternoon trade as it gave its intraday low of 5263.35. However, it saw a good amount of recovery in the later part of the session. It not only recovered its losses, but went on to give the day’s high of 5302.15. However the narrow recovery fizzled out in the last hour and half of trade as the Markets ended the day at 5278.60 posting a negligible loss of 0.30 points or 0.01%. The turnover remained much lower than the average. The Markets have formed a higher top and sharply higher bottom on the Daily High Low charts.
After a day of positive consolidation yesterday, there are all chances that the Markets continue with its up move today. Today, we can expect a positive start to the Markets and the Markets may open and trade positive, and continue with its up move at least in the initial session. The Markets will have to move past the levels of 5305 in order to continue the upward momentum. The intraday trajectory would be critical to see if the Markets moves past this levels or continues to consolidate.
The levels of 5305 and 5328 shall act as resistance on the charts and the levels of 5230 and 5190 shall act as immediate supports.
The RSI—Relative Strength Index on the Daily Chart is 67.4099 and it is neutral as it shows no negative divergence or failure swings. 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 indicating buoyant under current. The low volumes yesterday were the clear indicators of consolidation and the buoyancy that lies underneath.
Having said this, the Markets have some steam left on the upside. The action has turned very stock specific and sector specific. However, with the upward momentum expected to continue it would be essential to have a very stock specific approach. With the Market nearing its Overbought range the actions would have to be less aggressive.
All and all, positive day ahead. Even if the Markets consolidates, it is then expected to do it intraday and on lower volumes. The under current remains intact. Stock specific approach is advised. The profits will have to be protected at higher levels. While strictly avoiding shorts, positive outlook is advised for today.
Consulting Technical Analyst,