MARKET TREND FOR TODAY
November 08, 2012
Though the Markets came off a bit from its highs it still
managed to pull off a moderately decent close yesterday after a relatively
strong session. The Markets opened on a flat note and gave its intraday low of
5711.30 in the early morning trade as it slipped into the red for a very brief
period. However, it then came back into the positive territory and kept giving
new highs and managed to move past the critical resistance level of 5730 as it
gave the day’s high of 5777.30. In the last hour of trade, the Markets came off
a bit but still ended at 5760.10, ended the day with moderately decent gain of
35.70 points or 0.62% forming a higher top and higher bottom on the Daily High Low charts.
Today, in line with overall weakness in the global markets,
we are likely to see the Markets opening with a gap down and open again below
the critical levels of 5730. The global Markets are reacting to the US
Electoral outcome and as a result, it would be critically important to see the behaviour
of the Markets vis-à-vis the levels of 5730. There are chances that this level
may again act as resistance if the Markets open below it.
For today, in case of lower opening of the Markets, the
levels of 5730 and 5800 would continue to act as resistance and the levels of
5650-5630 shall act as supports.
The RSI—Relative Strength Index on the Daily Chart is
61.9491 and it has reached its highest value in last 14-days which is bullish.
The Daily MACD continues to remain bearish as it trades below its signal line.
NIFTY futures have continued to add in Open Interest and the
NIFTY PCR stands at 1.11 as against 1.12. Stock futures too have added nominal
Open interest.
The Markets still do not have a very clear directional
triggers. The weaker opening make cause the Markets to open below the levels of
5730 and there are chances that the Markets may resist to that levels again. In
that case, we will see the weakness returning to the Markets. In case of the
Markets managing to remain above the levels of 5730, a range bound
consolidation cannot be ruled out.
All and all, with still no clear directional triggers,
the Markets are likely to continue to
remain in broad 125-point trading range with the levels of 5630-5650 acting as
major supports. Even in case of lower opening some stock specific action may be
seen and it is therefore advised to continue to protect profits on either side.
Volatility may also continue to remain ingrained in the Markets. Neutral to
cautious outlook is advised for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
