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MARKET REPORT November
01, 2013
The Markets have attempted a upward breakout yesterday after
severely consolidating near the upper resistance levels of 6250 and ended the
day with a decent gain. The Markets opened on a modestly negative note and gave
its intraday low of 6235.90 in the very early minutes of the trade. After
trading with capped losses in the first hour of the trade, the Markets crawled
into the positive territory but continued to trade with capped gains and in a
very narrow range for the most part of the session. It was only in the last
hour and half of the trade that the Markets saw
a sudden spurt as it went on to give the day’s high of 6309.05. It
managed to maintain those levels and finally ended the day at 6299.15, posting
a decent rise of 47.45 points or 0.76% while forming a higher top and higher
bottom on the Daily High Low Charts.
MARKET TREND FOR TODAY
As evident from the Daily Charts, the Markets have attempted
a upward breakout after consolidating near its key resistance zone of 6230-6250
levels. Today, we can expect a flat to mildly negative opening but the Markets would continue to trade with
positive bias so long as it maintains the levels above of 6250.
For today, the levels of 6320 and 6335 would act as immediate
resistance for the Markets. The supports come in at 6250 and 6190 levels on the
downside.
The RSI—Relative Strength Index on the Daily Charts is 68.6825
and it has reached its highest value in last 14-days which is bullish. It does
not show any bullish or bearish divergence as such. The Daily MACD continues to
remain bullish as it trades above its signal line.
On the derivative front, the NIFTY November futures have
added over 41.77 lakh shares or 22.16% in Open Interest. This clearly indicates
that there was addition in long positions and the spurt that we saw was not on
account of short covering.
Given the above reading, it is clearly that we would
continue to see the Markets trading with positive bias so long as we see it
maintaining its levels above of 6250. Even in event of consolidation, the
levels of 6250 would continue to act as support for the Markets.
All and all, the Markets are likely to see the upward momentum
continuing so long as they are maintaining levels above of 6250. Even at higher
levels, if the Markets consolidates , the technicals suggest that they would do
so with positive bias with secotoral out performance continuing. While shorts
should be strictly avoided, any upward momentum should be used to protect
profits and any consolidation should be used to make selective purchases.
Positive bias is advised for the Markets today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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