MARKET
REPORT July
06, 2015
Markets had an
overall stable session on Friday as it spent the day in a sideways trajectory
and remained range bound but ended the day with modest gains. The Markets saw a
flat opening and soon strengthened in the morning trade to form the day’s high
of 8497.75. Since formation of this level, the Markets transformed itself into
a small trading range and remained in the 25-odd points range for the rest of
the day. It did come off a bit in the afternoon trade but recovered again to
trade around its morning highs. The Markets finally ended the day at 8484.90,
posting a net gain of 40 points or 0.47% while forming a higher top and
slightly lower bottom on the Daily Bar Charts.
MARKET TREND
FOR MONDAY, JULY 06, 2015
Even with
everything remaining perfect on domestic and technical grounds, the Markets
shall open today reacting to a “NO” vote in the Greek Referendum rejecting the
bail out package offered by its international creditors. This will see the
Markets opening just above its 200-DMA moving average. Fundamentally speaking,
India would be one of the least affected nations and therefore we can certainly
hope that this remains just a sentimental knee-jerk reaction. There are chances
that we see this downsides resulting into bargain buying later in the day.
For today, the
levels of 851 and 8565 are immediate resistance for the Markets. The supports
come in at 8375 and 8340 levels.
The RSI—Relative Strength
Index on the Daily Chart is 63.1856 and it has reached its highest value in
last 14-days which is bullish. It does not show any bullish or bearish
divergence. The Daily MACD remains bullish as it trades above its signal line.
On the Weekly Chart, the Weekly RSI is 53.3310 and is neutral showing no
bullish or bearish divergence or any failure swing. The Weekly MACD is bearish
as it trades below its signal line. However, it is attempting a positive
crossover and we might see it turning bullish next week.
On the derivative
front, NIFTY July futures have added yet another 3.84 lakh shares or 2.27% in
Open Interest. This signifies continuation of bullish momentum in the Markets.
The NIFTY PCR stands at 1.11 as against 1.09.
Coming to the
pattern analysis, the Markets have
attempted to move past its 100-DMA as well (which trades above its 200-DMA) and
had closed just a notch above it. However, today’s likely downside opening will once again bring
it in the range of 200-DMA on the lower side and 100-DMA. Today’s likely
negative opening will see the Markets trading near its 200-DMA again and it
would be crucially and critically important that the Markets do not breach the
200-DMA levels. On the weekly Chart,
last week, the Markets have managed to
move above the falling channel resistance and is likely to gather upward
momentum next week.
Overall, it is
very much likely that the today’s nearly imminent negative opening remains
temporary and just a knee-jerk reaction. There are great chances that the
Markets reduces its losses and improves as we go ahead in the session. Any
downside should be used for selective buying but at the same time, adequate
liquidity should also be provided for in order to deal with some moderate
amount of volatility that shall be seen ingrained 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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