MARKET REPORT April
30, 2014
The Markets continued with its correction for the third day
in a row, much on the expected lines as once again Markets ended the day with
losses. The Markets opened on a positive note but remained positive only until
few seconds while it formed its intraday high of 6779.70 in the very early
seconds of the trade. The Markets then soon dipped into negative territory to
trade modestly negative. The Markets showed trade in a capped range again as it
moved sideways in a very narrow trajectory. It did make a feeble attempt to
recover in the afternoon trade but gave up in the late afternoon trade once
again as it saw some selling pressure coming in. It weakened further as it went
on to post the day’s low of 6708.65. It finally ended the day at 6715.25,
posting a net loss of 46 points or 0.68% while continuing to form a lower top
and lower bottom on the Daily High Low Charts.
MARKET TREND FOR TODAY
Today, the Markets are likely to see a modestly positive
opening and is likely to trade positive in the early trade but there are all
chances that the Markets continues with its correction. Though intraday
trajectory would continue to remain critical, it is likely that the Markets may
trade in negative trajectory post opening.
For today, the levels of 6760 and 6795 would act as
immediate resistance for the Markets. The supports exist at 6685 and 6640
levels.
The RSI—Relative Strength Index on the Daily Chart is
53.8205 and it has reached its lowest value in last 14-days, which is Bearish.
Further, the RSI has made a new 14-period low but NIFTY has not yet and this is
Bearish Divergence. The Daily MACD continues to remain bearish as it trades
below its signal line.
On the derivative front, NIFTY May futures have shed over
8.65 lakh shares or 6.29% in Open Interest. This is a clear indication that
offloading of long positions have continued in NIFTY Futures . Stock futures
too have shown net decline in Open Interest.
Going by the pattern analysis, the Markets have retraced
after forming a immediate top of 6869 as it failed to break out on the upside
from 6820 levels. This will now keep the Markets in corrective mode until these
levels are breached with conviction. However, going by the pattern analysis,
lead indicators and further going by F&O data, the Markets are very clearly
likely to continue with its correction.
All and all, some amount of volatility will remained
ingrained in the Markets. The markets may also see some intermittent bounces
but it is very likely that it continues to remain in the corrective mode.
Keeping in line with this analysis, we continue to reiterate caution and
therefore the exposures should be kept moderate in the Markets while remaining
very selective and stock specific. Overall, continuance of cautious approach is
advised for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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