MARKET TREND FOR THURSDAY, MARCH 09, 2017
The Indian Equities ended the day with a modest loss of
22.60 points or 0.25% but this was not before the benchmark NIFTY50 recovered
from its intraday lows after witnessing good amount of volatility in the
morning trade. Today, we expect a modestly negative opening and the intraday
trajectory that the NIFTY forms will remain critically important. The Markets
have placed itself at a very critical juncture and we have to, therefore, look
at couple of important points that may heavily dominate the market moves in
coming days. With each passing day that Markets consolidate near its crucial
Double Top Resistance area, it is showing high amount of underlying strength.
Also, with the outcome of the UP Elections around the corner, more eyes in the
Markets will watch that than ever before and slightest sniff of the favorable
outcome for BJP will led great impetus to the on-going reforms and also give a
great sentimental boost to the Markets. On the other hand, we cannot ignore a
spike the US Bond yield as it goes on to expect the interest rate hike on March
15th.
Today, the levels of 8950 and 9035 will continue to act as
resistance levels for the Markets. The supports come in at 8835 and 8780
levels.
The Relative Strength Index on the Daily Chart is 63.5429
and this has reached its lowest value in last 14-days. The RSI has set a fresh
14-period low while NIFTY has not and this has resulted into Bearish
Divergence. The Daily MACD stays bearish while trading below its signal line.
No significant formations are observed on Candles.
The NIFTY March Futures have added over 3.17 lakh shares or
1.45% in Open Interest. This goes on to point towards likely continuation of
upward momentum in the Markets.
While having a look at pattern analysis, it now becomes more
than evident that the NIFTY has marked the 8950-8960 area as its major Double
Top resistance. In other words, meaningful up move shall occur only after the
NIFTY moves pas these levels and closes above it. Until this happens, we will
continue to see the NIFTY oscillating in a broad range and remaining vulnerable
to profit taking bouts.
Overall, two things remain extremely important to take
notice of. First, undoubtedly, the level of caution will heighten as a
precaution to the polls outcome will increase. Even though it is evident that
the Market are showing strong undercurrents, caution is likely to prevail as
the Markets brace the extended weekend. Secondly, despite the strong
undercurrents, it would be unwise to think that the NIFTY will decouple itself
with other global technical inputs. The spike in US Bond yield will certainly
remain a concern. We reiterate to remain extremely light on the positions and
avoid significant exposure on either side. Cash should be preserved while
adopting a cautious outlook 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
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