MARKET REPORT August
05, 2014
The Markets saw a smart technical pullback yesterday as it
opened positive, though fluctuated a bit but recovered smartly in the end to
end the day with decent gains. The Markets opened positive and thereafter
strengthening further in the morning trade, saw some weariness creeping in as
it gradually pared some of its gains in the first half of the session. The Markets
still managed to trade with decent gains even after coming off much from its
morning highs. However, the last hour and half of the trade saw some sharp
recovery coming in. The Markets pullback smartly and not only moved back to its
opening levels but moved past it to form the day’s high of 7694.80. Minor
throwback was seen from those levels and the Markets ended the day at 7683.65,
posting a net gain of 81.05 points or 1.07% while forming a lower top but
higher bottom on the Daily High Low Charts.
MARKET TREND FOR TODAY
Today, expect a total flat start to the Markets. The Markets
are expected to open on a quiet note and look for directions. What we have seen
yesterday was a technical pullback, though it has come on lower volumes. The
Markets continues to remain in its original pattern mentioned in our yesterday’s
edition of Daily Market Trend Guide. Further, today, RBI would announce its
credit policy later in the day and we would see the Markets reacting to it.
For today, the levels of 7720 and 7765 would act as
immediate resistance for the Markets. The supports come in at 7620 and 7550
levels.
The RSI—Relative Strength Index on the Daily Chart is
52.3743 and it is neutral as it shows no bullish or bearish divergence or any
kind of failure swings. The Daily MACD remains bearish after it reported a
negative crossover yesterday and now trades below its signal line.
On the derivative front, NIFTY August futures have added
over 2.75 lakh shares or 2.21% in Open Interest. This shows some fresh longs
have been added in yesterday’s trade.
The Markets continue to remain in broadening formation,
going by the pattern analysis. However, the volumes show a very definitive
indications in such cases. Though we continue to see technical pullbacks of the
likes that we saw yesterday, they come with much lower volume. Yesterday as
well, the volumes have hardly remained average. The Markets would continue to
meet its pattern resistances while attempting to move upwards. Though immediate
and intermittent pullbacks may be seen, one should heavily guard against
continuation of correction which can resume any moment once again if the Markets
resists at certain levels.
Overall, we would continue to see some stock specific
activities and the Markets would also react to the RBI coming up with the
credit policy. Though any change in Repo Rate, CRR or SLR has been widely ruled
out, it is likely to keep the session volatile. We continue to remain light on
overall exposures and continue to maintain adequate amount of liquidity and
caution in the Markets for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.