Friday, July 8, 2016

Daily Market Trend Guide -- Friday, July 08, 2016

MARKET TREND FOR FRIDAY, JULY 08, 2016
The Markets traded very much on dotted lines yesterday as it continue to consolidate and remained in a capped range while ending the day flat with nominal gains. Today as well, we continue to keep our analysis on similar lines. We can expect the Markets to fairly open on a quiet to modestly negative note and look for directions. It is very much expected of the Markets to continue to remain in a capped range and continue to consolidate in the given range.

For today, the levels of 8375 and 8400 continue to remain as immediate resistance levels for the Markets. The supports come in lower at 8305 and 8260 levels.

The RSI—Relative Strength Index on the Daily Chart is 62.2029 and it remains neutral as it shows no bullish or bearish divergence or any failures swings. The Daily MACD is currently bullish as it trades above its signal line.

On the derivative front, the NIFTY July future have shed over 2.60 lakh shares or 1.38% in Open Interest. Some amount of reduction of positions was evident in the session yesterday.

Coming to pattern analysis, as mentioned often in our previous editions, the Markets are currently consolidating after over 400-odd points of rise from the lows of June 24th. Not only Markets have recovered these losses, it has moved past its previous immediate resistance levels of 8295 and has managed a breakout on the upside from there. Currently, it continues to consolidate after such brilliant recovery and is preparing healthy grounds for further up move. Having said this, it is also important to note that it continues to trade in a upward rising channel drawn from the February lows that the Markets formed.

All and all, it is very much evident from the overall technical structure of the Charts and the F&O data that some amount of consolidation will continue to remain for some time. During this time, the Markets will continue to see capped movements and will also witness some volatility remaining ingrained in the Markets. It is advised to continue to maintain liquidity and keep purchases very selective and modest. While utilizing any available downside to make fresh selective purchases, cautious approach should be maintained in the Markets.


Milan Vaishnav, CMT
Technical Analyst

Member: Market Technicians Association, (MTA), USA
Member: Association of Technical Market Analysts, (ATMA), INDIA

+91-98250-16331

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