MARKET REPORT January
15, 2014
The Markets had a session wherein it consolidated yesterday
after a robust gain a day before on much lower volumes and ended the day with a
modest loss, much on the expected lines. The Markets opened on a modestly positive
note and formed its intraday high of 6280.35 in the early minutes of the trade.
However, immediately after this the Markets slipped into the negative
territory. Markets formed a intraday falling trajectory thereafter and remained
so for the rest of the session. It kept making new intraday lows and kept
losing ground steadily but on very low volumes. It went on to give its intraday
low of 6234.15 in the last hour of the trade. It finally ended the day at
6241.85, posting a modest loss of 30.90 points or 0.49% while forming a
slightly lower top and higher bottom on the Daily High Low Charts.
MARKET TREND FOR TODAY
After a consolidating
session yesterday, we can expect the Markets to open on a modestly positive
note and look for directions. Today, it might attempt to resume its up move but
at the same time, it is also likely to react to the WPI and CPI inflation data
coming in later today before noon. Any positive outcome, which is likely shall
aid the Markets on the upside. In the same breath, it can also give knee jerk
reaction if it turns out higher than what is expected.
Today, the levels of 6290 and 6325 are immediate resistance
on the Daily Charts. The supports come in at 6215 and 6190 levels.
The RSI—Relative Strength Index on the Daily Chart is
52.7493 and it is neutral as it shows no failure swings or any kind of bearish
or bullish divergence. The Daily MACD is bearish as it trades below its signal
line but it is moving towards reporting a bullish crossover.
On the derivative front, NIFTY January futures have added over 1.70 lakh shares or 0.97% in Open
Interest. This shows that some shorts have been added in yesterday’s session
and no offloading or unwinding has been observed.
Overall, if we look at the pattern analysis, the Markets
have survived the 50-DMA and have successfully taken its support at Close
levels after maintaining it couple of times. In event of any downside, this level
is likely to act as major support. In other words, the Markets shall have no
structural breach so long as it maintains the levels above of 6190. However,
this would be consolidation and any significant up move shall occur only after
it moves past the levels of 6250.
All and all, given the pattern of the lead indicators, it is
very much likely that the Markets resumes its upward movement after some
consolidation. The favourable WPI and CPI numbers will certainly aid to it.
This is what the lead indicators say, at least as of now. Therefore, while
continuing to avoid shorts, any downside should be used to make selective
purchases. Overall, cautious optimism is advised for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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