MARKET REPORT February
03, 2015
Markets saw a very volatile session but in the end settled
the day with minor losses ahead of RBI Credit Policy review. The Markets saw a
modestly negative opening and traded with capped losses in the morning trade.
It weakened further in the afternoon trade as it formed its intraday low of
8751.10. The Markets continued to spend some time in sideways trajectory and
the second half of the Markets saw some sharp recovery. It saw a near parabolic
rise as it not only went into the positive territory but also formed its day’s
high of 8840.80. It rose nearly 90-odd points from the low point of the day.
However, volatility refused to go away and the Markets retraced some of these
gains. It finally settled the day at 8797.40, posting a minor loss of 11.50
points or 0.13% while forming a lower top and lower bottom on the Daily Bar
Charts.
MARKET TREND FOR TUESDAY, FEBRUARY 03, 2015
The Markets have chosen to consolidate on Close levels. We
can expect a quiet opening to the session and the Markets would react to the
RBI Credit Policy review coming up. The opening trade is likely to see ranged
movement but the Markets would give some
knee-jerk reactions to the RBI inputs. Though any immediate rate cut is
discounted by the Markets but the any cut would trigger a positive surprise.
The levels of 8850 and 8925 would act as immediate
resistance to the Markets. The supports would come in at 8750 and 8670 levels.
The RSI—Relative Strength Index on the Daily Chart is
64.0535 and it remains neutral without showing any bullish or bearish
divergences or failure swings. The Daily MACD continues to remain bullish
trading above its signal line.
On the derivative front, the NIFTY February futures have
shed over 5.36 lakh shares or 2.10% in Open Interest. This very clearly suggests
that the pullback that we saw in the previous session was purely on account of
short covering from lower levels.
Coming to pattern analysis, as mentioned in earlier
editions, the Markets have formed an immediate top of 8985 levels and have seen
correction. It resisted to a rising trend line and in the process this rising
trend line continues to remain an extended resistance for the Markets. Any up
move, shall occur only after Markets moves past 8985-95 levels after a proper
and fresh area pattern. Until this happens, we would continue to see a broad
ranged consolidation in the Markets.
Overall, the Markets are going to remain volatile with some
negative bias. Positive trigger would come in for the short term only with the
RBI cutting rate again but this remains discounted to a much larger extent by
the Markets as no cut is expected. Speaking purely on technical terms, the
Markets would continue to consolidate with mild downward bias. It is continued
to adopt a cautious outlook for the day.
Milan Vaishnav,
Consulting Technical Analyst,
Af. Member: Market Technicians Association (MTA), USA
Af. Member: Association of Technical Market Analysts, INDIA
www.MyMoneyPlant.co.in
Af. Member: Market Technicians Association (MTA), USA
Af. Member: Association of Technical Market Analysts, INDIA
www.MyMoneyPlant.co.in
+91-98250-16331
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