Tuesday, March 22, 2016

Daily Market Trend Guide -- Tuesday, March 22, 2016

MARKET REPORT                                                                                          March 22, 2016
Markets continued to inch upwards precisely on expected lines and ended yet another day with decent gains. The Markets saw itself opening above its 100-DMA levels and stayed above it for the entire session. After seeing a modestly positive opening, the Markets failed to give a runaway rise but maintained itself above the 100-DMA levels. The first half of the session was spent with very limited gains in sideway trajectory. The Markets headed nowhere but it continued to maintain its critical levels. It was in the second half of the session that the Markets saw further strength coming in. It strengthened itself and went on to post gradual highs. The Markets went on to form the day’s high of 7713.55 by end of the session. These levels were maintained and it finally settled the day at 7704.25, posting a net gain of 99.90 points or 1.31% while forming a higher top and higher bottom on the Daily Bar Charts.

MARKET TREND FOR TUESDAY, MARCH 22, 2016
NIFTY have risen over 880-odd points from the lows it made in the Budget session. Today, the Markets are likely to see a quiet opening and there are all chances that the Markets may see some profit taking or it may consolidate from these levels. Few points from here, the Markets meet couple of pattern resistance on the Daily Charts. Therefore, the intraday trajectory that the Markets form would be critical to watch out for. The chances of some retracement cannot be ruled out.

For today, the levels of 7725 and 7740 will act as immediate resistance levels for the Markets. Supports come in lower at 7610 level.

The RSI—Relative Strength Index on the Daily Chart is 66.5447 and it has reached its highest level in last 14-days which is bullish. It does not show any bullish or bearish divergence on the Charts. The Daily MACD remains bullish as it continues to trade above its signal line.

On the derivative front, the NIFTY March futures have shed over 7.51 lakh shares or 3.38% in Open Interest. The NIFTY PCR stands at 1.05 as against 0.99 yesterday.

Coming to pattern analysis, the Markets resisted to the level of 7550 for several days. This was the level that the Markets breached on the downside and it was the triple bottom support for the Markets while it formed a Descending Triangle. On its way up, this level posed great level of resistance and forced the Markets to consolidate for several days. However, as the Markets breached this level on the upside, it gained nearly 150-odd points from there. It has now approached a pattern resistance once again. There are great chances that the Markets may consolidate at this level or may induce some profit taking post some gains today.

Overall, the Markets are all likely to see some consolidation or some amount of profit taking from higher levels today. With the Markets approaching multiple pattern resistance, this possibility cannot be ruled out. It is now advised to refrain from major purchase and greater emphasis should be laid by short term trades to book and protect profits at higher levels. Cautious 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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