MARKET REPORT March
30, 2016
The Markets thoroughly consolidated yesterday
and ended the day with modest losses though it was able to maintain itself
above its 100-DMA. The Markets saw a flat opening and after opening on a quiet
note, the Markets put on some minor gains in the morning trade. However, it
soon pared those gains in the late morning trade and by afternoon, it went on
to slip into negative to form day’s low of 7582.25. Taking support precisely at
its 100-DMA the Markets reversed and managed to recoup some of its losses. It
continued to oscillate in 40-odd points range for the entire session and at one
point formed its day’s high of 7652.90 in the late afternoon trade. However, it
pared those gains again and after slipping into negative, finally settled the
day at 7597, posting a net loss of 18.10 points or 0.24% while forming a lower
top and lower bottom on the Daily Bar Charts.
MARKET TREND FOR WEDNESDAY, MARCH 30,
2016
The Markets are likely to see a positive
opening today as the global set up remains positive following dovish Federal
Reserve statements. However, speaking purely on technical grounds, the analysis
continues to remain similar on yesterday’s lines. The Markets may see positive
opening but at the same time, there are chances that the rallies may get sold
into. There are chances that the Markets continue to consolidate and the levels
of 100-DMA continue to act as support.
For today, the levels of 7650 and 7685 will
act as immediate resistance on the Daily Charts. The supports come in at 7589
and 7550 levels.
The RSI—Relative Strength Index on the
Daily Chart is 57.8685 and it remains neutral as it shows no bullish or bearish
divergence or any failure swing. The Daily MACD is bullish as it trades above
its signal line. However, the slope of histogram is seen sloping indicating
some loss in strength on temporary basis.
On derivative front, heavy rollovers
continued as the March NIFTY futures shed over 26.94 lakh shares or 14.37% in
Open Interest and April futures added over 47.53 lakh shares or 72.30% in Open
Interest indicating net addition in Open Interest.
While having a look at pattern analysis,
the overall pattern analysis also continues to remain in line with our
yesterday’s view. The levels of 7720-7750 have become immediate top for the
Markets and the trend line to which the Markets resisted at these levels is a
falling trend line drawn from 8600 levels. With each passing day, this trend
line, due to its falling nature, lowers the resistance levels for the Markets.
To make it simple, entire 7700-7750 zones have become resistance zone for the
Markets as the Markets meets more than one pattern resistance levels. Any runaway rally would occur only if the
Markets are able to move past the 7750 level and until that happens,
irrespective of the openings that we get, we will continue to consolidate in a
capped range and there would always remain a possibility of intermittent
selling bouts from higher levels.
Overall, we also enter the penultimate day
of expiry of current derivative series and the trade is bound to remain
affected and dominated with rollovers. While continuing with our yesterday’s
view, we reiterate that any rallies and higher openings should be better
utilized to book and protect profits and new positions should be kept limited.
Overall, continuance of 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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