MARKET REPORT May
26, 2015
Markets turned bit corrective today as it opened negative
and grew weaker in the second half to end the day with losses. The Markets saw
a negative opening on expected lines and traded within a narrow range with
capped losses. It spent the morning trade in a sideways manner on low volumes
as many major Markets like UK, US and Hong Kong remained shut which led to a
lesser participation. However, it was in the second half that the Markets saw
some weakness intensifying and it grew weaker. It went on to form the day’s low
of 8364.15 towards the end of the session. While no major recovery was seen at
lower levels, it finally ended the day at 8370.25, posting a net loss of 88.70
points or 1.05% while forming a lower top and lower bottom on the Daily Bar
Charts.
MARKET TREND FOR TUESDAY, MAY 26, 2015
After the Markets remaining in corrective mode yesterday, we
can expect a quiet opening in the Markets today. The Markets are likely to open
on a flat to mildly positive note and look for directions. They are likely to
continue to remain in a broad trading range with the levels of 200-DMA acting
as support and the levels of 50-DMA acting as resistance in the immediate short
term.
Today, the levels of 8420 and 8465 will act as immediate
resistance for the Markets. The supports come in at 8320 levels.
The RSI—Relative Strength Index on the Daily Chart is
50.1338 and it remains neutral as it does not show any bullish or bearish
divergence or any failure swing. The Daily MACD remains bullish while trading
above its signal line.
On the derivative front, the NIFTY May futures shed over
9.50 lakh shares or 7.39% in Open Interest while June NIFTY Futures added over
6.81 lakh shares or 18.01% in Open Interest showing a net of decline in Open
Interest. However, modest rollovers have begun and they are expected to pick up
as well. The NIFTY PCR stands at 1.03.
Going by pattern analysis, the Markets currently trade in a
broad range with the levels of 200-DMA expected to act as support and the levels
of 50 and 100-DMA posing resistance on the upside. However, given the expiry
week, the Markets are likely to continue to remain in a broad trading range.
Also, the Markets will have to see a conviction based up move with more amount
of delivery buying taking place if it has to move past the upper levels of the
trading range. Broadly speaking, the Markets have attempted to find a bottom
after posting lows as on May 7th and has attempted a pullback since
then. However, it needs to form a higher bottom anytime now and move past the
remaining two DMAs in order to confirm the reversal.
All and all, until the Markets moves past its 50 and
100-DMA, it would continue to witness such intermittent bouts of profit taking.
Though 200-DMA is all likely to act as major support in case of any downside, the
Markets may continue to remain volatile and trade in a broad range. It is
advised to continue to remain light on exposure while maintaining a stock
specific outlook 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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