MARKET REPORT May
18, 2015
Markets
consolidated on Friday as it moved in a capped range in the entire session and
ended the day with modest gains, though it still continued to rule below its
200-DMA. The Markets saw a positive opening and immediately formed its intraday
high of 8279.20 in the very early minutes of the trade. Soon after that the
Markets saw sudden paring of gains in the morning trade as it came off from
those levels to trade flat. However, the rest of the session was spent
recovering from those levels but the Markets never really moved decisively on
the either side. It continued to trade in a capped range but remained in
positive territory for the entire session. It finally ended the day at 8262.35,
posting a modest gain of 38.15 points or 0.46% while forming a higher top and
higher bottom on the Daily Bar Charts.
MARKET
TREND FOR Monday, 18 May 2015
If we put it in
plain words, despite forming a temporary bottom in the previous sessions, the
Markets continue to remain in little precarious position. Today, we can expect
a flat to mildly positive opening but this would have the Markets open near its
200-DMA. The Markets have closed below 200-DMA and therefore the behaviour of
the Markets after opening as against its 200-DMA would be crucially important.
It would be very necessary for the Markets to move past and remain above its
200-DMA in order to attempt a reversal.
For today, the
levels of 8300 and 8365 will act as immediate resistance for the Markets. The
supports come in at 8160 and 8135 levels.
The RSI—Relative Strength
Index on the Daily Chart is 46.0736 and it remains neutral showing no bullish
divergence or any failure swings. The Daily MACD remains bullish as it trades
above its signal line. On the Weekly Charts, the Weekly RSI is 46.3706 and this
too is neutral without showing any bullish or bearish divergence or any failure
swings. The Weekly MACD remains bearish while trading below its signal line.
On the derivative
front, NIFTY May futures have shed 71,525 shares or 0.51% in Open Interest.
This is a very nominal and insignificant change in Open Interest. It is also NIFTY
Futures have dipped into a nominal discount on the Friday’s trade which is a
positive factor which indicates a potential formation of bottom.
Coming to pattern
analysis, the Markets are still ruling below its 200-DMA on Daily Charts after
forming a potential bottom. It would be imperative for the Markets to move past
and sustain above the levels of 200-DMA in order to confirm this potential
bottom formation and continue with its successful reversal. On the Weekly
Charts, the Markets have taken support at its 50-DMA levels.
All and all,
though lead indicators and F&O data point towards positive bias in the
Markets, cautious approach should still be maintained until the Markets moves
past the 200-DMA levels and is out of the broad trading band and above 8350
levels. Until this happens we will remain exposed to possibilities of some
volatile intermittent swings on the either side.
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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