MARKET TREND FOR WEDNESDAY, FEBRUARY 15, 2017
The Indian Equity Markets continued to fiercely consolidate
for the sixth day in a row and went on to once again end the day with minor
loss of 12.75 points or 0.14%. Today, as we open, there are all chances of a
modestly negative opening. Despite great amount of strength is displayed at
Close levels, the NIFTY also faces the surge in the US Dollar with its trading
at a 3-week high and the spike in the Treasury Bond Yields. With these
readings, we can also not dismiss the fact that the NIFTY still continues to
trade in overbought territory. This can
continue to infuse volatility once again in the session. There are chances that
we may see some pressure in the opening trade but also display resilience as we
go ahead in the session. The behavior of
the Markets vis-à-vis the levels of 8230 will continue to remain immensely
important.
For today, the levels of 8230 and 8900 will continue to act
as immediate resistance levels for the Markets.
Supports come in lower at 8730 and 8650 are expected to act as immediate
supports.
The Relative Strength Index – RSI on the Daily Charts is
71.5783 and it remains neutral showing no bullish or bearish divergence. The
Daily MACD is still bullish while trading above its signal line. But it is now
evidently moving towards reporting a negative crossover. No significant
formation on the Candles is observed.
The NIFTY February futures have added yet another over 10.32
lakh shares or 4.63% in Open Interest.
While having a look at pattern analysis, we can see the
strong consolidation happening on the Daily Charts at Close levels. In the last
six days, we have seen NIFTY ending with minor changes but the sessions have
witnessed good amount of volatility with NIFTY oscillating quite a bit on
either side. Normally such behavior is interpreted as strong undercurrent.
However, taking into account global technical indicators such as strengthening
of the US Dollar and the spike in the US Bond yields, we cannot rule out the
possibility of the NIFTY continuing to remain in such consolidation for some
more time. In the present circumstances, the levels of 8220-8230 will remain
very critical levels to watch out for.
All and all, we can expect a subdued opening and might see
some negativity in the initial trade but at the same time, we cannot rule out
some resilience coming at play. Such behavior is likely to induce volatility in
the session. Any sustainable up move shall occur only after the NIFTY moves
past the 8220-8330 zones and until this happens we will continue to see
volatile oscillations of the NIFTY in a defined range. While remaining light on
the overall positions, cautious outlook is advised for the day.
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
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.