MARKET REPORT March
02, 2015
Markets had a horrifying session on Saturday while it dealt
with the first full Budget from the present government and it swung nearly
190-odd points on either side, that too for multiple times before ending the
day with modest gains. The Markets saw a near gap up opening on Saturday and
while it approached the Budget, it saw gradual paring of its morning gains.
Wild reactions and swing started as the proposals start pouring in. Markets,
while trying to digest the budget, swung violently on either sides and at one
point of time came off nearly 190-odd points from the high point of the day,
which was 8941.10, to touch the day’s low of 8751.35. The final hour of the
trade saw equally violent and volatile recovery from the low point of the day
and it finally settled the day at 8901.85 posting a modest gain of 57.25 points
or 0.65% while forming a higher top and higher bottom on the Daily Bar Charts.
MARKET TREND FOR MONDAY, MARCH 02, 2015
The Markets shall open today after a greatly violent and
volatile session on Saturday while reacting to Budget proposals. However,
today, we are again likely to see a gap up opening and the Markets are expected
to open on a decently positive note. However, at the same time, it is important
to note that even if the Markets opens on a strong and positive note, it is
likely that the Markets remains within a rising trend line as evident on the
Daily Chart. Therefore, the intraday trajectory that the Markets form post
opening would be crucial.
The levels of 8950 and 9060 would act as immediate
resistance for the Markets. The supports would come in at 8830 and 8750 levels.
The RSI—Relative Strength Index on the Daily Chart is
61.3861 and it shows no failure swing. However, the NIFTY has formed a fresh
14-day high while the RSI has not and this is Bearish Divergence. The Daily
MACD still continues to remain bearish trading below its signal line. On the
Weekly Charts, Weekly RSI is 68.5577 and shows no failure swing. However, NIFTY
has formed a fresh 14-week high but RSI has not and this shows Bearish
Divergence as well. The Weekly MACD continues to trade above its signal line
and is therefore bullish.
On the derivative front, NIFTY March futures have added over
15.17 lakh shares or 6.27% in Open Interest. This very clearly shows that fresh
buying has been done and the rise that occurred in the second half of the
session was not merely due to short covering.
Coming to pattern analysis now, it is very important to take
note of few important things.
Even if the Markets see a gap up opening and
touches the psychological mark of 9000; or while doing so, posts a fresh life
time highs, it will NOT be giving any fresh breakouts. It is very much likely
that it continues to remain within the upper rising trend line. Though it may
continue to remain in overall rising trajectory, fresh lifetime highs should
not be taken as fresh breakouts. Therefore, again, in such case, consolidation
from higher levels cannot be ruled out.
Overall, keeping in view the overall structure of the
Charts, the Markets may open positive and continue with its up move but since
it would be far from achieving a break out, it would walk towards its pattern
resistance of upper rising trend line. Given this fact, it is advised to use
all the up moves that occur to reduce positions or book and protect profits on
existing positions while taking fresh exposures very selectively.
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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