Thursday, July 18, 2013

Daily Market Trend Guide -- Thursday, July 18, 2013

MARKET REPORT                                                                                          July 18, 2013
The Markets had a quite volatile session yesterday as it moved  both ways in the second half of the session to ultimately end with modest gains. The Markets opened on a modestly positive note and in the morning trade went on to give its intraday high of 5989.80. The Markets did not made much headway as such as it continued to move in sideways trajectory and with capped gains. However, in the second half the Markets saw some sudden paring of gains. It not only came off its day’s highs but also dip into the red. It went on to give the day’s low of 5925.75, coming of almost 70-odd points from its day’s high. However, in the last hour of the trade, the Markets saw sharp recovery again as it not only recovered from its day’s lows but also went back into the green. It finally ended the day at 5973.30, posting a modest gain of 18.05 points or 0.30% while forming a higher top and higher bottom on the Daily High Low Charts.


MARKET TREND FOR TODAY

For today, expect the Markets to open on a modestly positive note and continue with the up move. There has been a disruption in the up move that the Markets were witnessing due to RBI Announcements but more or less it should continue as there is no structural breach on the Charts. The Intraday trajectory would be important the Markets would require to maintain the levels above its 50-DMA.

For today, the levels of 5995 and 6035 would act as immediate resistance on the Charts. The supports come in at 5925 and 5913 which is the 50-DMA of the Markets.

The lead indicators continue to remain firmly in place. The RSI—Relative Strength Index on the Daily Chart is 56.9334 and it is neutral as it shows no bullish or bearish divergence or failure swings . The Daily MACD too remains bullish as it trades above its signal line.

On the derivative front, NIFTY Futures have continued to add nominal open interest. This is minor positive sign as there has been no shedding of open interest reported. However, fresh longs still remains to get built up which shall give impetus to further up move.

Having said this, there are some important things to note. One, there has been no structural breach on the technical charts despite disruption of the up move caused by RBI Announcement on MSF front. Secondly, the Markets have not shown too much of unwinding yesterday. It would be important to see that some fresh longs get build up and the markets remain above the levels of 50-DMA. 

All and all, the Markets would see a modestly positive start and continue with its yesterday’s pullback, at least in the initial trade. There will be no structural breach on the Charts so long as the Markets trade above the levels of 50-DMA. However, volatility may remain. In such case, profits on long positions should be protected at higher levels but shorts should still be strictly avoided.  Downticks should be used to make selective purchases. Overall, cautious optimism is advised for today.

Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331



No comments:

Post a Comment

Note: Only a member of this blog may post a comment.