Thursday, February 28, 2013
MARKET TREND FOR TODAY February 28, 2013
Yesterday’s session remained more or less on expected lines as the oversold Markets attempted a pullback and at the same time the levels of 5810 continued to act as resistance but still the Markets ended the day with decent gains. The Markets opened on a moderately positive note and after briefly trading positive; it dipped into the red to give the day’s low of 5749.70. However, it then transformed itself into rising trajectory and reversed the trend. It came back into the green and kept moving upwards in rising channel. It went on to give day’s high of 5818.20 in the late afternoon trade. The Markets hovered around those levels, came off a bit and finally ended the day at 5796.90, still posting a decent gain of 35.55 points or 0.62% while forming a lower top and similar bottom on the Daily High Low charts.
Today would be the most critical session for the Markets today. We have our most important external event, Union Budget, coming up today and we also have expiry of the current derivative series today. Expect the Markets to open on a positive note and move in a capped range for the first hour and half of the trade. It shall start reacting as Budget proposals come up. The volatility is imminent today and the sustenance of the Markets above the levels of 5810 would be of critical importance.
For today, the levels of 5810 and 5865 shall act as immediate resistance for the Markets. The supports come in much lower at 5740.
The lead indicators are neutral. The RSI—Relative Strength Index on the Daily Chart is 34.6981 and it is neutral as it shows no bullish or bearish divergence or failure swings. The Daily MACD is remains bearish as it continues to trade below its signal line.
On the derivative front, NIFTY and stocks continues to witness heavy rollovers and most of the rollovers happened on the long side as it added in total open interest. Fundamentally speaking, we have discounted most of the negatives in the correction that we saw in the month of February.
The Markets are bound to remain volatile and shall keep giving knee jerk reactions to the budget proposals as we go in further into the session. However, the Markets will take a fundamental call, but at the same time the down side in the Markets would be limited given the overall technicals and the F&O statistics.
All and all, unless some drastically negative comes in, we will continue to see range bound movements with knee jerk reactions ingrained it. But with the scenario, we would continue to advice to refrain from building any shorts. Any downside that may follow should be used in making high selective purchases as sectoral out performance would be seen. Overall, cautious approach with tinge of positive optimism is advised for today.
Consulting Technical Analyst,
Wednesday, February 27, 2013
We have not been able to publish today's edition of Daily Market Trend Guide in PDF Format. However, we are reproducing the brief version below. Inconvenience is sincerely regretted.
BRIEF MARKET FORECAST FOR THE DAY
The Markets grossly disappoint yesterday as it breached the 10-DMA as well as it pattern support and also went on to breach the levels of 5810 which were yet another support levels.
Technically speaking, the Markets have given a downward breach and as such it is expected to remain sluggish in the immediate short term
For today, expect the Markets to open on a flat note and look for directions. Today we enter into penultimate date of the expiry series and with Union Budget coming up tomorrow, the Markets shall have though time reacting to it.
The Markets have breached its pattern supports of 5810 and these levels shall act as immediate resistance on the upside.
However, the Markets have gone OVERSOLD. The RSI--Relative Strength Index on the Daily Charts stands at 28.4271 and and it trades in oversold territory. The Daily MACD remains bearish as it trades below its signal line.
All and all, given the big external event tomorrow, we might see volatile movements in the Markets. With the Markets being oversold, we would now recommend refraining from any shorts but at the same time, remain very selective in making fresh purchases. We may see sluggish movements in the Markets continue to immediate short term. Overall, cautious outlook is advised for today.
Consulting Technical Analyst,
Tuesday, February 26, 2013
MARKET TREND FOR TODAY February 26, 2013
The markets had a volatile session yesterday, but still headed nowhere as it ended the day absolutely flat once again after a volatile trade swinging both sides. The Markets opened on a moderately positive note and after brief positive trade, drifted into the red. I again managed to come back into the positive territory but was not able to sustain these minor gains. I saw a sharp paring of gains as it went on to give the day’s low of 5825 in the mid afternoon trade. However, the Markets saw equally sharp pullback later as it traded back into positive and also went on to give the day’ high of 5878.40. This was not sustained either as it slowly pared this recovery also as it traded again around its previous close levels. It finally ended the day at 5854.75, posting a negligible gain of 4.45 points or 0.08%. It formed a lower top and lower bottom on the Daily High Low Charts.
Today, we are expected to see a modestly negative opening in the Markets. The Markets continue to stay critically poised as it struggles to stay above its pattern support of 5840-5850 however it has maintained its support of 100-DMA of 5843.06 at Close levels. It would be critical for the Markets to maintain levels above this in order to avoid weakness. Some volatile reaction, though momentary, are expected to Rail Budget which shall come up later today.
For today, the levels of 5890 and 5915 are immediate resistance for the Markets. The critical supports come in at 5840 and 5843 at Close in form of 100-DMA and the next support comes in at 5780 levels.
The lead indicators show no directional triggers. The RSI—Relative Strength Index on the Daily Chart is 37.1247 and it is neutral as it shows no negative divergence or failure swings. The Daily MACD continues to trade below its signal line.
On the derivative front, the NIFTY Futures have continued to add open interest. It has added in total open interest by over 4.30 lakh shares.
Along with three important events, i.e. Rail Budget, Economic Survey and Union Budget coming up in this week, which is also a expiry week of the current derivative series, the Markets shall continue to see such behaviour for the rest of the week. The directional movement is expected only next week once Markets digests all domestic developments.
All and all, with the Markets likely to remain volatile and consolidate, it will have limited downward bias, at least as of now until anything seriously negative comes out. This is because of the shorts that exists in the system. However, until it gets any directional trigger, it shall continue to remain volatile and range bound. It is advised to continue to remain light on the positions while also continuing with cautious approach to the Markets.
Consulting Technical Analyst,
Monday, February 25, 2013
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.
Consulting Technical Analyst,