MARKET TREND FOR TUESDAY, MARCH 07, 2017
The Markets ended the day on a strong note after a tepid
start and ended the session on Monday near the high point of the day posting
gains of 65.90 points or 0.74%. The Charts indicate that this up trend is likely
to continue and after ending at the fresh 2-year highs, the NIFTY will try and
continue to extend its gains, though with some intermittent range bound
oscillations. Today, we expect a modest start to the session and as we go
ahead, we expect the NIFTY to march towards 9000-mark. However, beyond this,
the NIFTY is again expected to spend some time in consolidation and
intermittent bouts of profit taking cannot be ruled out near the 9000-mark. The
Markets are showing very strong upward bias and momentum and it is also very
much supported by the F&O data. Again, a run-away rise beyond this level is
not expected.
For today, the levels of 8995 and 9030 will act as likely
resistance levels and the supports will come in at 8890 and 8810 levels.
The Relative Strength Index – R SI on the Daily Chart is
68.7508 and it shows no failure swings. The NIFTY has set a fresh 14-period
high but the RSI has not yet and this has resulted into Bearish Divergence on
this oscillator. The Daily MACD is still bearish as it trades below its signal
line. A Rising Window has occurred on the Candles. This is a gap and it
usually implies continuation of the prevailing uptrend.
The NIFTY March futures have added 84,075 shares or 0.39% in
Open Interest. This indicates minor addition of fresh longs to the system.
The pattern analysis shows the NIFTY oscillating in a capped
range after marking a Double Top on the Daily Charts. The levels of 8950
continue to remain a Double Top resistance area. The NIFTY has moved past this
level and has ended a notch above that but it still remains within its filter.
However, the buoyant undercurrents displayed by the Market makes is very likely
that after spending a brief time around these levels, we will see the
NIFTY
attempting to test higher levels.
All and all, we expect the Markets to remain strong and
display strong momentum on the upside. The lead indicators are exhibiting some
fatigue but this will at the most cause some intermittent profit taking bouts
but the downsides are likely to remain relatively much limited. We reiterate
our recommendation to refrain from creating major short positions and continue
to utilize corrective dips in making fresh purchases.
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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