MARKET REPORT February
20, 2014
The Markets ended the day with gains on the fourth day in
a row wherein it saw a last hour spurt
once again after a capped session to end the day with modest gains. The Markets
opened on a mildly positive note and the Markets remained positive for the
entire session. However, post modestly positive opening, the Markets remained
in a very narrow 15-odd points range. The movement remained capped on improved
volumes. However, it was in the last 45-minutes of the trade that the Markets
saw a strong and sharp spurt. It went on to move past its 100-DMA levels to
touch the day’s high of 6160.35. It maintained gains around those levels and finally
ended the day at 6152.75, posting a net gain of 25.65 points or 0.42% while
continuing to form a higher top and higher bottom on the Daily High Low Charts.
MARKET TREND FOR TODAY
The Markets have closed near its 100-DMA levels which is
6149 today and this levels is again
likely to pose resistance at Close levels. This is because, following subdued
global cues, the Markets are likely to see a negative opening and open below
the levels of 100-DMA. However, in the similar breath, the Markets are also
likely to show some resilience to the
opening weakness. The intraday trajectory that the Markets form would be
important as there are chances that we may see improvement as we go ahead in
the session.
For today, the levels of 6160 and 6230 would act as immediate
resistance on the Daily Charts. The supports exist at 6105 and 6060 levels on
the downside.
The lead indicators continue to show resilience and remain
perfectly in place. The RSI—Relative Strength Index on the Daily Chart is
53.4670 and it has reached its highest value in last 14-days which is bullish.
It does not show any bullish or bearish divergence. The Daily MACD remains
bullish as it continues to trade above its signal line.
On the derivative front, NIFTY February Open Interest has
remained unchanged as it has added some 8450 shares or just 0.05% in Open
Interest. From this, it becomes fairly clear that the spurt that we saw
yesterday has resulted into fresh buying, or if we put it otherwise, it has not
seen any sharp short covering either.
Overall, once again returning to pattern analysis, the
Markets have resistance at Close at 6149 levels which is the 100-DMA and going
further at 6185 which is the 50-DMA. However, if the Markets manage to move
past the levels of 100-DMA with good volumes and participation, it should not
face much difficulty in inching upwards.
All and all, the Markets would see some subdued opening but
at the same time, it is likely to show resilience. It is likely that we may see
improvement in the levels as we go ahead
in the session. In case of any downside, the volumes are likely to remain low
resulting into limited downside and some consolidation. Shorts should be
avoided and any downside should be used to make very selective purchases.
Overall, continuance of cautious optimism is advised for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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