MARKET TREND FOR MONDAY, MARCH 20, 2017
Putting buoyancy on display, the Indian Equity markets
showed no signs of correction and ended on Friday on a flat note gaining 6.35
points or 0.07%. On Monday, we expect a subdued opening in the Markets and expect
some consolidation to set in. The NIFTY has not shown any correction as of now
at Close levels but in Friday’s session, it has certainly shown some signs of
fatigue and therefore, there are all chances that we see NIFTY50 taking a
breather and some amount of healthy consolidation sets in.
The levels of 9175 and 9220 will act as resistance levels
while supports will come in at 9104 and 9061.
The Relative Strength Index – RSI on the Daily Chart is
77.2426 and it has reported a fresh 14-period high which is bullish. However,
it trades in overbought territory. The Daily MACD has not reported a positive
crossover and it is now bullish while trading above its signal line.
On the derivative front, the NIFTY March futures have shed
over 11.57 lakh shares or 4.44% in Open Interest. This signifies some profit
taking at higher levels and also indications potential consolidation at current
levels in the Markets.
Coming to pattern analysis, the NIFTY achieved a clear
breakout above the 9000-mark and has went on to confirm this breakout as well.
The breakout occurred from a major Double Top formation and therefore the
levels that it breached, i.e. the 9000-mark has now become a important pattern
support for the Markets. In event of any consolidation or a range bound corrective
activity, this level of 9000-mark will remain critical to watch out for.
All and all, some signs of fatigue and exhaustion at
9200-levels in the NIFTY are apparent and evident. However, the lead indicators
continue to show any buoyant intent. If we take a judicious view of all this,
there are all chances that we witness some corrective activity in the Markets.
Importantly, given the strong undercurrent, such corrective activity is likely
to remain in form of range bound consolidation and very limited downsides. The
broader Markets continue to remain supportive and individual stock specific and
selective approach will hold the importance in coming sessions.
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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