MARKET REPORT January
13, 2014
What appeared as a decent recovery for the Markets, fizzled
out to be a flat close for the Markets as the caution outweighed the positive
sentiment ahead of IIP numbers on Friday. The Markets saw a mildly negative
start and gave its intraday low of 6139.60 in the early minutes of the trade.
However, after this, the Markets saw a strong recovery from the low point of
the day. It not only crawled back into the green but also went on to
comfortably move past its resistance of 50-DMA while its gave its intraday high
of 6239.10. However, this levels were not sustained as the caution took over
ahead of IIP numbers. The Markets gave up all of its gains and came off over
50-odd points from its day’s low. It finally ended the day at 6171.45, totally
flat, posting a negligible gain of 3.10 points or 0.05% while forming a sharply
higher top and a mildly lower bottom on the Daily High Low Charts.
MARKET TREND FOR TODAY
The IIP numbers that
came in after markets hours on Friday have been lower at -2.1%. However, the
silver lining among the numbers is that the CAD – Current Account Deficit has narrowed.
This is likely to go down well with the Markets. Expect the Markets to open on
a positive note and again, the opening is likely around its 50-DMA and this
levels, i.e. 6193, would be crucial to watch out for.
Today, the levels of 6193 and 9240 would act as immediate
resistance levels. The supports come in at 6165 and 6130 levels.
The RSI—Relative Strength Index on the Daily Chart is
45.2735 and it is neutral as it shows no bullish or bearish divergence or any
kind of failure swings. The Daily MACD still continues to trade below its
signal line. On the Weekly Charts, the RSI is 54.6548 and it is neutral as it
shows no bullish or bearish divergence and no failure swings as well. The
Weekly MACD remains bullish as it continues to trade above its signal line.
On the derivative front, NIFTY January futures Open Interest
has remained unchanged as it shed just 27,350 shares or 0.16% in Open Interest.
This is a positive factor, in a way, that on its way down while the NIFTY shed
over 50-odd points from its day’s high, no significant shedding of long
positions has been seen. The Put Call Ratio has remained 0.91 as against 0.92 a
day before.
All and all, the 50-DMA today continues to remain crucial.
The opening of the Markets is likely to test the 50-DMA levels and it would be
important for the Markets to move past that level and trade above that. There
is still no breach on the Daily Charts as the Markets trade within its filters.
It is advised to continue to refrain from creating shorts. Sectoral out
performance would continue. Continuance of positive caution is advised for
today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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