MARKET TREND FOR TODAY
January 08, 2013
The Markets saw some profit taking coming in after a
positive start as it pared its early morning gains to trade flat in the mid
session and end up further lower by the end of the session. The Markets opened
on a mildly positive note and traded in a capped range in the morning session
as it gave its intraday high of 6042.15 in the very early minutes of the trade.
Thereafter, after trading in a capped range, the Markets saw some weakness
creeping in in the afternoon trade as the Markets drifted into the negative
territory. In the last hour and half of the trade, the Markets saw some more
weakness creeping in as it went on to give the day’s low of 5977.15. It finally
ended the day at 5988.40, posting a modest loss of 27.75 points or 0.46% while
forming a higher top but lower bottom on the Daily High Low Charts.
Today, expect the Markets to open on a flat to mildly
negative note and look for directions. The Markets have achieved a breakout on the upside but have not broken out
in a convincing manner and it is likely to continue to consolidate in a range.
Intraday trajectory would continue to remain crucial and critically important
to decide the trend for the day.
For today, the levels of 6030 and 6065 shall continue to act
as resistance for the Markets and the levels of 5940-5950 levels, which the
Markets broke on the upside, shall continue to serve as supports.
The lead indicators suggest some more consolidation / mild
profit taking, though with a bias on the upside. The RSI—Relative Strength
Index on the Daily Chart is 63.6424 and it shows no negative divergence or
failure swings. The Daily MACD continues to remain bullish as it trades above
it signal line. On the Candles, however, and Engulfing Bearish line has
occurred. The engulfing bearish
pattern is bearish during an uptrend, which is the case with NIFTY and this
signifies possibility of momentum seeling little weakness in the immediate
short term. However, this needs confirmation today.
On the Derivatives front, NIFTY January Futures have
continued to shed Open Interest as it shed over 7.24 lakh shares or 4.32% in
the net Open Interest and this is not a
good sign as it shows some unwinding done yesterday. The NIFTY PCR
stands at 1.03 as against 1305.
All and all, so long as Markets continue to trade above the
levels of 5940-5950, it will be in a consolidation phase again and weakness
shall creep in only below these levels. Until this happens, we will see a range
bound movement with little volatility ingrained in it. It is advised to refrain
from shorts and selective purchases may be done while vigilantly protecting
profits. Overall cautious optimism is advised for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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