Friday, May 22, 2015

Daily Market Trend Guide -- Friday, May 22, 2015

MARKET REPORT                                                                                 May 22,2015
The Markets consolidated in yesterday session as it swung on either side but ended on absolutely flat note after recovering from its lows. The Markets saw near –flat opening but soon formed its intraday high of 8446.35 in the very early minutes of the trade. However, the Markets soon came off from its highs and saw some rapid paring of gains and formed the day’s low of 8382.50 in the late morning trade, coming off nearly 65-odd points from the high point of the day. The Markets attempted to find its bottom again as it saw some recovery coming in and it managed to recover all of its gains and also went into positive territory by afternoon session. No major movement was seen and the Markets spent rest of the session heading nowhere. It finally ended the day at 8421, posting a very minor loss of 2.25 points or 0.03% while forming a near parallel bar on the Daily Bar Charts.


MARKET TREND FOR FRIDAY, MAY 22, 2015
Today’s analysis continues to remain more or less on similar lines. Expect the Markets to open on a flat to mildly negative note and look for directions. Though quiet opening is expected, the Markets will continue to trade in a capped range and some volatility like yesterday cannot be ruled out. The Markets are consolidating going near to its 50-DMA and 
though such consolidations are healthy, it would be crucial for the Markets to continue with their up move especially given the expiry in the next week.

For today, the levels of 8475 and 8540 will act as immediate resistance levels for the Markets. The supports come in at 8315 levels.

The RSI—Relative Strength Index on the Daily Chart is 53.1863 and it remains neutral showing no bullish or bearish divergence or any failure swing. The Daily MACD continues to remain bullish trading above its signal line.

On the derivative front, NIFTY May futures have shed over 4.39 lakh shares or 3.23% in Open Interest. Though we can attribute this to short covering, merely attributing this singularly to short covering will not be proper as some amount of rollovers too have begun.

Coming to pattern analysis, the reading remains similar to that of yesterday. After moving past the levels of 200-DMA,  the Markets are showing sideways consolidation and in the process, the two immediate resistance for it are its 50 and 100-DMA respectively. Though such consolidation is healthy, it would now be crucial for the Markets to move past these levels. Until this happens ranged consolidation is expected to continue with the levels of 200-DMA expected to act as support.

All and all, keeping the overall analysis on the similar lines that of yesterday, the Markets may see ranged movement post negative opening and intermittent bouts of weakness cannot be ruled out. Some purchase may be made as sector specific  out performance would be seen but overall, maintenance of caution at higher levels is advised.

Milan Vaishnav,
Consulting Technical Analyst,
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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