MARKET REPORT April
01, 2016
The technical factors prevailed over the
Markets as the Markets failed to move past its pattern resistance and ended the
day flat with nominal gains after coming off from its intraday highs. The
Markets saw a flat opening and after opening modestly on a negative note it
soon crawled into the positive territory. It went on to strengthen itself in
the morning trade while it formed its intraday high of 7777.60. However, it got
itself in sideways trajectory in the early afternoon trade. The Markets were
unable to hold on to its gains and by midsession had pared all of its gains to
trade flat. It did saw a spurt in the later part of the afternoon but that was
not sustained either as it was followed by a near vertical paring of gains
where the Markets formed its intraday low of 7702. With some recovery, it
finally settled the day at 7738.40, posting a flat close with minor gains of
3.20 points or 0.04% while forming a higher top and higher bottom on the Daily
Bar Charts.
MARKET TREND FOR FRIDAY, APRIL 01,
2016
Caution is likely to prevail in the Markets
as the Markets are expected to open on a modestly negative note. The Markets,
as of now, has failed to clear its important pattern resistance of a falling
trend line and with the expected lower opening, the zone of 7730-7760 will
continue to pose resistance to the Markets. On the downside, the levels of
100-DMA is expected to act as support. The intraday trajectory that the Markets
form after opening would be important to watch out for.
For today, the levels of 7750 and 7785 will
act as important resistance levels for the Markets. The supports come in much
lower at 7650 and 7610 levels.
The RSI—Relative Strength Index on the
Daily Chart is 64.4578 and it does not show any failure swing. However, RSI has
set a fresh 14-period low whereas NIFTY has not yet and this is Bearish
Divergence. Daily MACD is bullish as it
still continues to trade above its signal line.
On the Candles, a Spinning Top has occurred. Such formations
often tend to have potential to halt the up moves temporarily.
On derivative front, NIFTY witnessed over
68.20% of rollovers and the Market Wide rollovers were seen over 72%. The April
series saw addition of over 46.78 lakh shares or 32.97% in Open Interest. The NIFTY PCR stands at
1.10 as against 1.08.
Coming to pattern analysis, the Markets
have resisted to one of its important pattern resistances; a falling trend line
drawn from 8600 levels. The Markets have been oscillating back and forth while
resisting to this falling trend line and taking support on its 100-DMA on the
lower side. Today, with modestly lower opening expected, the Markets are likely
to continue to resist to this pattern resistance and subsequently, the 100-DMA,
which is 7583 is expected to act as support at Close levels.
Overall, the resistance zone of 7730-7760
continues to hold good as of today and the Markets will not witness any runaway
up moves until it significantly moves past this level. As of now, the 100-DMA
holds as important support failing which 7550 may be tested. We continue to
reiterate our cautious outlook on the Markets while continuing to keep fresh
purchases and very moderate levels. Cautious outlook for the day is advised.
Milan
Vaishnav,
Consulting Technical Analyst
Member: Market
Technicians Association, (MTA), USA
Member: Association of Technical Market Analysts,
(ATMA), INDIA
+91-98250-16331
