MARKET TREND FOR WEDNESDAY, SEPTEMBER 28, 2016
The domestic equity markets traded precisely on the analyzed
lines as they ended with a minor cut after remaining highly volatile and
choppy. The levels 8680 continued to remain critical and the Markets nearly
tested its 50-DMA. Today, we can see the Markets attempting to stabilize and
just like yesterday, the levels of 50-DMA which is 8683 will remain critically
important to watch out for. This keeps our analysis on similar lines like
yesterday. We also enter the penultimate day of expiry of the current
derivative series and this will see the session remaining dominated with
rollovers.
For today, the levels of 8745 and 8790 will act as immediate
resistance levels while the supports will come in at 8680 and 8610.
The RSI—Relative Strength Index on the Daily Chart is
47.0865 and it has reached its lowest value in last 14-days and this is
Bearish. The Daily MACD stays bearish while it trades below its signal line.
On the derivative front, the NIFTY September futures have
shed over 43.96 lakh shares or 17.59% in Open Interest. The October futures
have added over 49.83 lakh shares or 56.81% in Open Interest.
Coming to pattern analysis, it is very much evident that a
lower top has been formed at 8900 levels after the Markets formed its
intermediate top at 8968 levels. It also becomes important to note that there
will be no significant up move unless the Markets move past 8900 levels and
until this happens will see the Markets oscillating in a trading range. In the
immediate short term, the levels of 50-DMA will continue to act as important
support at Close levels. Any drift below this level will induce some more
weakness in the Markets.
In the session tomorrow, we may see Banks attempting to find
bottom. Select Midcaps and other sector specific out-performance will continue.
It is advised to approach the Markets with individual stock specific
strategies. Positions on either side should be kept limited and more cash
should be preserved as the markets will establish its directional bias on
either side. Though, with no structural damage on the Daily Charts, cautious
optimism is advised for today.
Milan Vaishnav, CMT
Technical Analyst
(Research Analyst, SEBI Reg.
No. INH000003341)
Member:
Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
Association of Technical Market Analysts, (ATMA), INDIA
http://milan-vaishnav.blogspot.com
+91-98250-16331
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