MARKET REPORT August
13, 2014
The Markets had a extremely buoyant pullback yesterday as it
saw a gap up opening, strengthened further in the second half of the session
and ended the day with decent gains though volumes continued to remain a
concern. Following favourable cues, the Markets saw a decent nearly gap up
opening yesterday. After opening in such manner, the Markets saw steady
progress in the session as it remained in capped sideways range with virtually
no volatility. In the second half of the session the Markets perked up further.
It went on to form the day’s high of 7735.75. After hovering around those
levels, it finally ended the day at 7727.05, posting a decent gain of 101.10
points or 1.33% while forming a sharply higher top and higher bottom on the
Daily High Low Charts.
MARKET TREND FOR TODAY
Today, the Markets are expected to take some breather from
the up moves that it has been witnessing since last two days. The Markets are
expected today to open on a quiet and modestly negative note and look for
directions. There are chances that the Markets begin to consolidate again from
higher levels here. Intraday trajectory and volumes would continue to play
critical role in directing the trend today.
For today, the levels of 7760 and 7815 would act as
immediate resistance. The supports would come in at 7650 and 7620 levels.
The RSI—Relative Strength Index on the Daily Chart is
54.6491 and it is neutral as it shows no bullish or bearish divergence or any
kind of failure swing. The Daily MACD continues to remain bearish as it trades
below its signal line.
On the derivative front, the NIFTY August futures have added
over 3.43 lakh shares or 2.74% in Open Interest. This shows some more addition
of fresh longs in the system.
Continuing with the pattern analysis, the Markets have seen
a decent technical pullback after breaching its 50-DMA, but not breaching its
filter. While doing so, the pullback has been witnessed with relatively lower
volumes. The Markets may see some consolidation again from these levels while remaining
in the broadening formation on the Daily Charts.
All and all, we continue to advice on similar lines as that
of yesterday. Any pullbacks witnessed should be utilized more on booking and
protecting profits. More emphasis should be laid on protecting profits at
higher levels than making new purchases which should be limited and extremely
selective. While preserving liquidity, cautious optimism is continued to be
advised.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
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