MARKET REPORT January
29, 2014
The levels of 100-DMA stood out as support as the Markets
spent an extremely volatile session amid RBI rising Repo Rate by 25 bps while
it ended the day with negligible loss. The Markets opened on a quiet note as
expected and spent the morning session in a capped range while it gave its
intraday high of 6163.60. Thereafter, the Markets saw a very sharp paring of
gains after RBI raised the repo rates as it came off over 80-odd points in a very
sharp vertical fall while reporting its day’s low of 6085.95. While reporting
both the intraday high and the low in the morning trade, the Markets spent the
rest of the session recovering from its lows and spending the rest of the
session in a capped range. The Markets recovered almost all of its losses and
finally ended the day at 6126.25, while
posting a negligible loss of 9.60 points or 0.16% while forming a lower top and
lower bottom on the Daily High Low Charts.
MARKET TREND FOR TODAY
The levels of 100-DMA has stood out as support at Close
levels and today, we are expected to see some respite from the weakness that we
have been seeing. The markets are expected to open on a modestly positive note
and look for directions. As evident from the Charts, the Markets have broken support
of a trend line and its 50-DMA and therefore it would be critically important
for the Markets to move past that levels to resume its up move.
For today, the levels of 6165 and 6210 would act as
immediate resistance for the Markets while the levels of 6110 is likely to act
as support at Close levels.
The RSI—Relative Strength Index on the Daily Chart is
39.2754 and it has reached its lowest value in last 14-days which is bearish.
It does not show any bullish or bearish divergence. The Daily MACD trades below its signal line.
On the derivative front, rollover continued as the NIFTY
January futures have shed over 18.50 lakh shares or 14.65% in Open Interest whereas
the February futures have added over 37.05 lakh shares or 42.84% in the Open
Interest.
The pattern analysis shows the Markets breaching the levels
of 50-DMA and a rising trend line which coincides as a same levels around
6200-6215. It would be therefore very important for the Markets to move back
above these levels for resuming a sustainable up move. So long as it rules
below these levels it will have a looming danger of consolidation and some
further correction. However, positively speaking, the levels of 100-DMA have
stood out as support at Close levels.
All and all, the Markets will find resistance near the
6200-6215 levels while the levels of 100-DMA acting as supports. It is advised
to continue to remain light on the positions while maintaining liquidity and
making very selective, few purchases and protecting existing profits at higher
levels. The directional consensus still lacks however, the room for improvement
remains strong and intact. Overall, cautious optimism is advised for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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