MARKET TREND FOR TODAY April
15, 2013
The Markets had a thoroughly disappointing session on Friday
as it opened gap down and remained in a capped range thereafter in sideward
trajectory till the end of the session to end the day with losses. The Markets
opened gap down and after trading sideways, became further weak in the afternoon
session as it gave it day’s low of 5494.90. It saw a mild recovery in the
second half but did not do much to cut the losses. The movement in the sideways
trajectory continued and the Markets finally ended the day at 5528.55, posting
a loss of 65.45 points or 1.17% while forming a sharply lower top and lower
bottom on the Daily High Low Charts. The Infosys was the biggest loser
making a major dent in the NIFTY which
did not cheer the IIP data that was released.
The recovery / pullback that was seen in the Markets in last
two session has abruptly came to an end by the Friday’s session. We may see
some weaker opening today and can fairly expect the weakness to continue in
line with weakness in Asian Markets. European Markets too closed weak on
Friday, though US Markets have remained flat. The intraday trajectory would be
important to decide the trend post opening and the Markets may test the Friday’s
lows.
For today, the levels of 5490 and 5465 shall act as
immediate supports for the Markets. The Markets would find resistance at 5540
and 5575 levels.
The RSI—Relative Strength Index on the Daily Chart is
36.2299 and it is neutral as it shows no bullish or bearish divergence or any
failure swings. The Daily MACD is bearish as it continues to trade below its
signal line. The pattern on the Candles has a “on-neck line” which is potentially bearish and indicates
continuation of weakness for the short term. On the Weekly Charts, the RSI is 41.0052 and it has just reached the
lowest value in last 14-weeks which is bearish. The Weekly MACD continues to
trade below its signal line and is therefore, bearish.
On the derivative front, NIFTY Futures have continued to add
over 4 lakh shares or 2.05% in Open Interest. Though creation of heavy shorts
in the NIFTY has continued, it has also seen selling in the Cash Markets.
Stockwide open interest has also added validating this reading.
Having said this, it is also important to note that the
Markets have breached the 50-DMA on the WEEKLY Charts. There are fair chances
that if the Markets breaches the Friday’s low, it can well slip to 5380-5400
levels.
All and all, there are no directional triggers for the up
move in the Markets. Intermittent pullbacks may be seen in this week, but as
mentioned often in our previous editions, sustainable up move shall occur only
after the Markets moves past its 500-DMA. Until then, any trade that takes
place will have a downward bias. Overall, it is advised to refrain from aggressive
purchases and maintain high degree of caution in the Markets.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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