MARKET TREND FOR WEDNESDAY, JANUARY 11, 2017
The NIFTY put on display once again its inherent buoyancy as
it ended the day with a decent gain of 52.55 points or 0.64% and at the same
time, resisted to its key levels as well which we mentioned in our previous
edition. The NIFTY resisted precisely at its 200-DMA and ended the day just at
those levels. Today’s opening would be extremely critical for the Markets. In
all probability, speaking purely on technical note, we expect the NIFTY to open
above its 200-DMA and continue with its up move. The behavior of the NIFTY
vis-à-vis the levels of 8286, which is the 200-DMA will be crucial to watch out
for. The intraday trajectory that the NIFTY forms will be critically important
to decide the trend for the day.
For today, the levels of 8290 and 8355 will remain immediate
resistance levels for the Markets. The supports will come in at 8165 and 8110
levels.
The RSI—Relative Strength Index on the Daily Chart is
59.8905 and it has reached its highest value in last 14-days which is bullish.
It does not show any bullish or bearish divergence. The Daily MACD stays firmly
bullish while trading above its signal line. A while body has occurred on the
Candles. No major formations are seen on the Candles.
The NIFTY January series saw a nominal addition of 2175
shares or just 0.01% in Open Interest. This figure is too small to suggest any
change in underlying sentiment.
A look at the pattern analysis clearly indicates underlying
buoyancy. The NIFTY, after pulling back nearly 300-odd points after forming a
Double Bottom support at 7900-7920 zones, consolidated for just a very brief
period without any retracements. It moved up again and once again it remained
flat at Close levels and consolidated. It is important to note that the NIFTY
is tracking the 200-DMA and it would be critically important for the NIFTY to
move past this level for resumption of a sustainable up move.
It is further important to note that the consolidation of
NIFTY near the upper range of the broad trading zone that it has formed
certainly depicts underlying buoyancy. It is very much likely that we see the
NIFTY opening above the 200-DMA. However, it would be crucial for the NIFTY to
remain and trade above 200-DMA. Any dip below 200-DMA will again see a ranged
consolidation on the Charts. We continue to reiterate maintaining a positive
outlook on the Markets.
Milan Vaishnav, CMT
Technical Analyst
(Research Analyst, SEBI Reg. No. INH000003341)
Member:
Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
+91-98250-16331
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