MARKET TREND FOR TODAY
February 25, 2013
The Markets attempted a feeble up move on Friday, but
ultimately ended up consolidating for yet another time as it pared its gains in
the end to end the day absolutely flat with negligible losses. The Markets
opened on a mildly negative note but moved into the positive territory in the
initial trade. After briefly trading in the positive, it drifted in to the red
as it gave its intraday low of 5835.80. However, it transformed itself into
rising trajectory thereafter as it moved back into the positive. It remained in
upward rising channel as it gave its intraday high of 5873.80 in the later part
of the trade. In the last hour of the trade, it failed to sustain those levels
as it pared all of its gains to end the day at 5850.30 posting negligible loss
of 1.95 points or 0.03%, forming a lower top and lower bottom on the Daily High
Low Charts.
Today’s session would be critically important for the
Markets. We enter into rollover week, have railway budget tomorrow and also the
expiry and the Union Budget this coming Thursday. This is certainly going to
keep the Markets volatile testing its critical levels on either side. For
today, expect a flat opening in the Markets and it would be critically
important for the Markets to trade above 5850 in order to avoid weakness.
For today, the levels of 5840 and 5805 shall act as
important supports. Resistance would be at 5895 and 5920 levels.
The lead indicators do not paint a rosy picture. The RSI—Relative
Strength Index on the Daily Chart is 36.2619 and it has reached its lowest
value in last 14-days which is Bearish. However, it does not show any bullish or
bearish divergence. The Daily MACD continues to remain bearish as it trades
below its signal line.
On the derivative front, NIFTY Futures have added over 3.86
lakh shares or 2.39% in Open Interest which is certainly a positive sign in the
Markets.
In order to avoid any further weakness, the Markets shall
have to trade above 5850. Any drifting below this levels shall see it testing
the levels of 5805.
All and all, as mentioned, the 5850 levels would be critical
and drift below may see the levels of 5805. However, at the same time, the
number of shorts that exists in the system will see it taking supports here or
at lower levels and therefore, no significant breakdown is expected as such.
The Markets shall remain volatile and trade in a range until it remains
dominated by major external events. Cautious and selective approach is advised
for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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