Daily Market Trend Guide -- Thursday, November 26, 2015

MARKET REPORT                                                                       November 26, 2015

The Markets headed nowhere in a absolutely range bound session and it traded virtually on dotted lines while ending the day with modest losses. The Markets saw a quiet opening on a mildly negative note and formed its intraday low of 7812.65 in the early minutes of the trade. The Markets soon crawled back into the positive territory after that but traded flat with minor gains. The Markets spent the majority of the afternoon trade in a flat and narrow sideways trajectory heading nowhere. It did perk up a bit and formed its intraday high of 7870.35 but failed to sustain that as well. The Markets evidently lacked volumes and it pared its gains once again to trade flat and later dip further into negative. Markets finally ended the day at 7831.60, posting a modest loss of 17.65 points or 0.22% while forming a slightly lower top and lower bottom on the Daily Bar Charts.

MARKET TREND FOR THURSDAY, NOVEMBER 26, 2015

Markets would open today after a holiday and we enter into expiry of the current November derivative series. The Markets are likely to give a modestly positive opening but at the same time, the session is likely to remain absolutely dominated with rollover centric activity. The F&O data clearly suggest that the Markets may continue to remain and trade in a broad range and is less likely to take any clear directional call.

For today, the levels of 7870 and 7915 will act as immediate resistance levels for today. The supports come in at 7800 and 7750 levels.

The RSI—Relative Strength Index on the Daily Chart is 41.2319and it remains neutral as it shows no bullish or bearish divergence. The Daily MACD continues to remain bearish as it trades below its signal line. However, it is important to note and that the Daily MACD is likely to report a positive crossover if there is no significant breach on the Daily Charts.

On the derivative front, rollovers continued as the NIFTY November futures shed over 19.71 lakh shares or 14.31% in Open Interest. The December series added over 35..17 lakh shares or 33.34% in Open Interest, showing net addition of over 16 lakh shares in Open Interest. The NIFTY PCR stands unchanged at 0.77.

Coming to pattern analysis, the Markets have spent nearly a fortnight trading in a capped range and remaining in congestion zone. Having said this, as mentioned often in our previous editions, the Markets have attempted to form a bottom but have not confirmed it as of now. It continues to remain in congestion zone and trading in no direction. However, it has maintained so far, a important support level of 7680 levels. In order to avoid any significant weakness, the Markets will have to trade and maintain levels above 7680 in event of any temporary weakness.

Overall, the Markets continue to trade in a congestion zone. Though it has maintained its important pattern support levels so far, it has not confirmed is reversal and therefore it continues to remain vulnerable to selling bouts from higher levels. Being the expiry day today, the Markets remain prone to volatile movements. It is, therefore, reiterated that exposures in Markets should be kept moderate and cautious outlook should be continued while maintaining adequate liquidity.

Milan Vaishnav,
Consulting Technical Analyst

Af. Member: Market Technicians Association, (MTA), USA
Af. Member: Association of Technical Market Analysts, (ATMA), INDIA
www.EquityResearch.asia
http://milan-vaishnav.blogspot.com

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