MARKET REPORT March
17, 2016
The Markets showed a sharp recovery in the
second half of the session and ended the day with modest gains after a tepid
start. Markets saw a very quiet opening as it opened on a flat note and after a
very brief positive trade, it slipped very soon in to the negative territory. It
continued to remain in downward falling trajectory in the first half of the
session. It kept losing ground gradually and went on to from the day’s low at
7405.15. In the second half, the Markets saw a remarkable recovery coming in.
It not only managed to recoup all of its losses, but went ahead to trade in the
green. It went on to form the day’s high of 7508 while recovering over 103-odd
points from the high point of the day. While maintaining those levels, the
Markets finally settled the day at 7498.75, posting a modest gain of 38.15
points or 0.51% while forming a lower top and lower bottom on the Daily Bar
Charts.
MARKET TREND FOR THURSDAY, MARCH 17,
2016
The Federal Reserve decided to keep the
rates unchanged, much on the expected lines and this would be welcomed by the
Markets in a big way. The Markets are expected to see a gap up opening and this
trigger will see the Markets attempting to break out once again from the consolidation
that it has been witnessing and move past critical resistance levels of 7550.
The Markets are likely to test its 100-DMA of 7628 either today or in immediate
short term.
For today, the levels of 7550 and 7585 are
immediate resistance levels for the Markets. The Supports come in at 7450 and
7430 levels.
The RSI—Relative Strength Index on the
Daily Chart is 57.7002 and it remains neutral as it shows no bullish or bearish
divergence or any failure swings. The Daily MACD stays bullish as it trades
above its signal line.
On the derivative front, the NIFTY March
futures have added over lakh shares or
0.57% in Open Interest. The NIFTY PCR stands unchanged at 0.95.
While having a look at pattern analysis,
the Markets have pulled back over 10% from the lows it formed on the Union
Budget day. Having said this, it resisted to the level of 7550. As mentioned of
ten in our previous editions of Daily Market Trend Guide, this level was the
triple bottom of a descending triangle that the Markets broke on the downside.
Now, on its way up, this level has been acting as stiff resistance. However,
the Markets have been displaying good amount of strength as it did not show any
sign of weakness or sell-off near
this level. It has been consolidating for
over 8-days now. Today, with the trigger provided by Fed Reserve as it did not
hike the rates will see the Markets getting a possible gap up opening and this
will have the Markets once again open above 7550 levels. The key would be to
see if the Markets sustain above this and achieve a breakout. The next logical
targets that once can expect to see is the Markets testing its 100-DMA.
Overall, gap up opening is very much likely
and we will see the Markets moving past easily above 7550 at least in the
initial trade. The key would be to see if this sustains. The possibilities of
the Markets sustaining and building up are bright and we can expect to see the
Markets testing its next logical targets of 100-DMA. Overall, positive outlook
is advised for today.
Milan Vaishnav,
Consulting Technical Analyst
Member: Market
Technicians Association, (MTA), USA
Member: Association of Technical
Market Analysts, (ATMA), INDIA
+91-98250-16331
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