MARKET TREND FOR FRIDAY, April 22,
2016
The Market’s up move has been halted over
previous two sessions. Once again, with no structural change in the Daily
Charts, today’s analysis once again remains on similar lines. We are likely to see
a quiet opening in the Markets and the levels of 7950 will continue to pose
immediate resistance to the Markets. Therefore, the intraday trajectory of the
Markets and its behavior vis-à-vis its 200-DMA will be important to watch out
for.
For today, the levels of 7950 and 7975 will
act as immediate resistance for the Markets. The supports come in much lower at
7865 and 7810 levels.
The RSI—Relative Strength Index on the
Daily Chart is 67.4745 and it remains neutral as it shows no bullish or bearish
divergence or any failure swings. The Daily MACD continues to stay bullish as
it trades above its signal line.
On the derivative front, the NIFTY April
futures have shed over 4.05 lakh shares or 2.48% in Open Interest. This signifies
reduction / unwinding of long positions in the Markets post the intraday highs.
The NIFTY PCR stands at 1.06 as against 1.08.
Coming to pattern analysis, the Markets
have been able to remain a notch above its 200-DMA which is 7865. However, as
mentioned often in our previous editions, the Markets have not given a clear
breakout on the Weekly Charts. Given the overall structure of the Daily Charts
and if this is read along with the other lead indicators and the F&O data,
the Markets are unlikely to give any runaway rise until it moves past 7950
levels. Until this happens it continues to remain vulnerable to selling
pressures from higher levels. In event
of any corrective action, the level of 7865, which is the 200-DMA will continue
to act as support if the Markets consolidates. However, if the Markets breaches
the 200-DMA we will see some more weakness creeping into the Markets.
Overall, no major buying should be done
until the Markets moves past 7950 levels. Until the Markets moves past this
level, it is likely to consolidate with the level of 200-DMA acting as support.
Buying should be kept restricted and we
continue to reiterate our advice of using up moves to protect profits and
existing positions. Overall, 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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