MARKET REPORT April
16, 2015
The Markets snapped its 7-day gaining streak as it saw a
sharp but otherwise healthy correction in the last hour of the trade wherein it
ended the day with losses. The Markets saw a quiet opening but it traded with modest
losses all throughout the session. The range remained extremely narrow and
capped and the Markets never really attempted any upside movement at all. It
opened negative and traded with modest losses for the most part of the day. In
the later part of the afternoon trade, it did attempt to move up wherein it
went into green for a very brief time while forming the day’s high of 8844.80.
Just when it seemed that it will consolidate, it saw a very sharp downside. It
was more of a secular basket selling as the Markets lost ground very rapidly.
It lost over 100-odd points from the high point of the day while forming the
day’s low of 8722.40. It finally ended the day at 8750.20, posting a net loss
of 83.80 points or 0.95% while forming a similar top but lower bottom on the
Daily Bar Charts.
MARKET TREND FOR THURSDAY, APRIL 16, 2015
Expect the Markets to open on a flat to modestly positive
note and look for directions. The Markets snapped its 7-day gaining streak
yesterday but has closed above its
50-DMA and as of now this level has held out as support. Today as well, the
levels of 50-DMA would be crucial to watch out for and the Markets are likely
to hover around those levels. It would be important for the Markets to remain above
this level or at least its filters to avoid any further weakness.
For today, the levels of 8795 and 8850 will act as immediate
resistance for the Markets. The supports would come in at 8710 and 8675 levels.
The RSI—Relative Strength Index on the Daily Chart is
55.4478 and it remains neutral as it shows no bullish or bearish divergences or
failure swings. The Daily MACD continues to remain bullish as it trades above
its signal line.
On the derivative front, NIFTY April futures have added over
6.30 lakh shares or 3.36% in Open Interest. This very clearly suggests addition
of sizable quantity of short positions in the Markets. This is a crucially
positive figure as the buying from lower levels as well as short covering may
prevent the Markets from further weakness.
Coming to pattern analysis, post lows of 27th
March, the Markets had gained over 400-points in seven straight sessions. The
correction that we saw yesterday can prove to be healthy for the Markets. Even
if the Markets consolidate in a range bound manner from these levels, it would
be, in fact, healthy for the Markets in the immediate short term. The levels of
50-DMA would be important level to watch out for along with its filter as a
important support at Close levels.
Overall, the Markets may see buying from lower levels. If
not, then at least 50-DMA levels, it can also see some amount of short covering
in the Markets. Given this scenario, it is advised to refrain from creating any
short positions in the Markets. Purchases may be done but should be kept very
limited while maintaining adequate liquidity in the Markets.
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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