MARKET TREND FOR TODAY
April 03, 2013
The Markets had a positive and buoyant second half as after
opening flat and consolidation in the first half the Markets perked up to end
the day with decent gains. The Markets opened on a flat note yesterday and made its intraday low of 5687.15 in the
initial minutes of the trade. Thereafter, after trading in a capped range in
the morning session, the Markets came into the positive territory. In the
afternoon session until end, it kept making new intraday highs. The Markets
rose over 65-odd points from its lows and went on to give the day’s high of
5754.80. It hovered around those levels until end and finally ended the day at
5748.10, posting a decent gain of 43.70 points or 0.77% while forming a higher
top and higher bottom on the Daily High Low charts.
Today, we can expect the Markets to take some breather
before it continues with its up move. Expect the Markets to open on a mildly
negative note and look for directions. There are chances that after two day’s
of up move the Markets consolidates again and some minor profit taking can be
seen in the initial session. However, chances of improvement as we go ahead in
the session cannot be ruled out.
For today, the levels of 5760 and 5785 are expected to act
as immediate resistance levels and the levels of 5710 and 5680 shall act as
immediate support for the Markets.
The lead indicators are neutral to mildly bullish. The RSI—Relative
Strength Index on the Daily Chart is 46.4343 and it is neutral as it shows no
bullish or bearish divergence and also shows no failure swings. The Daily MACD
is still bearish as it trades below its signal line but the it shows early likelihood
of a positive crossover.
On the derivative front, the NIFTY April Futures have added
over 10.89 lakh shares in Open Interest. This is very important indicator and
it very clearly portrays that the rise that we saw in the second half of the
session was not because of any short covering. This also further shows that
there were fresh longs created in the system.
Having said this, it can be fairly concluded that the undercurrent
remains buoyant even if we see some temporary consolidation or mild profit
taking in the initial trade.
Overall, with the above reading, the analysis is very much
clear that unless we see a technical breach on the charts, one should refrain
from shorts and any momentary consolidation or minor profit taking should be
utilized to make fresh purchases while continuing to guard and protect profits
at higher levels. Overall, though cautious, but positive outlook is advised for
today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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