MARKET REPORT February
19, 2014
The Markets had a strong session yesterday wherein it opened
on a modestly negative note but strengthened to end the day with very decent
gains. The Markets opened on a quiet and mildly negative note and formed its intraday
low of 6066.80 in the very early minutes of the trade .The Markets then soon
traded back in the positive territory. The morning trade saw the Markets
strengthening further. It move in a upward rising trajectory while it kept
making gradual advancements. It went on to touch its 100-DMA while it formed
its fresh intraday high of 6141.70 in the late afternoon trade. The Markets
finally ended the day at 6127.10, posting a decent gain of 53.80 points or
0.89% while forming a sharply higher top and higher bottom on the Daily High
Low Charts.
MARKET TREND FOR TODAY
Today would again be a session of consolidation for the
Markets, at least in the initial trade. The Markets are likely to open on a
flat and quiet note and look for directions. The levels of 100-DMA is likely to
act as very near resistance and the Markets may see some consolidation before
it inches upwards. The intraday trajectory that the Markets forms and the
volumes would be critically important.
The levels of 6145 and 6180 would act as immediate
resistance levels for the Markets. The supports would come in at 6105 and 6070
levels.
The lead indicators continue to firmly remain in place. The RSI—Relative
Strength Index on the Daily Chart is 50.9018 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 Futures have shed 5.70 lakh
shares or 3.51% in Open Interest. This indicates that the rise that we saw can
be attributed to the short covering in the Markets. However, some addition has
been seen in the key stock futures which have seen fresh buying.
Going by the pattern analysis, the Markets have attempted to
break out of the trading range that it has been trading in. However, it is yet
to move past the 100-dma and this level is likely to continue to act as
immediate resistance for the Markets. While it attempts to move past the levels
of 6150, it will have to do so with good amount of participation and volumes in
order to make the upward breakout more sustainable.
All and all, the Markets still continues to remain in broad
trading range. The intraday trajectory of the Markets and the behaviour vis-à-vis
the levels of 100-DMA would be very important today. It is advised to continue
to vigilantly protect profits at higher levels. Very selective purchases may be
made as well. Overall, cautious but positive outlook is advised for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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