MARKET OUTLOOK FOR WEDNESDAY, MAY 17, 2017
The Indian Equities continued to enjoy the liquidity driven
gush as the benchmark NIFTY50 continued to scale fresh highs and ended the day
on a fresh life-time high as well. We cannot ignore the liquidity fuelled
upsurge that the domestic markets are currently witnessing but at the same
time, also it would not be wise to continue to blindly chase the stocks with
badly overstretched indicators. We expect a positive opening to the Markets on
Wednesday and upward tendencies might persist. At this juncture, it would be
extremely important to protect existing profits at higher levels and
effectively churn sectors to rightly participate in the uptrend.
The levels of 9525 and 9560 will now act as likely
resistance levels. The supports come in at 9460 and 9410 zones.
The Relative Strength Index – RSI on the Daily Chart is
71.9469. Though it is bullish as it has marked a fresh 14-period high, it now
remains in overbought territory. The Daily MACD is bullish while staying above
its signal line. A rising window occurred on Candles. This is essentially a gap
and it usually has bullish implications.
The pattern analysis suggests that the NIFTY has managed to
move beyond the rising trend line resistance that it was witnessing over past
couple of days. Though this implies a breakout, caution needs to be exercised
as the Markets are now overbought. The zones of 9350-9375 which the immediate
resistance zone is now expected to act as support.
All and all, given the underlying buoyancy intact, there are
all chances that the Markets may take a breather either on Wednesday or in
immediate future. The downsides in such an event are likely to remain extremely
limited. We reiterate protecting profits at higher levels and effective shift
sectors to avoid minor corrective activities. The sectors who had been laggards
in the past like IT, AUTO, etc are expected to now participate.
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.