MARKET OUTLOOK FOR WEDNESDAY, AUG 23, 2017
The benchmark NIFTY50 failed to capitalize on a buoyant opening
that it got in Tuesday’s trade and ended the day after oscillating in a capped
range with minor gain of 11.20 points or 0.11%. The NIFTY has ended the day a
notch below its 50-DMA but remains within its filter and trades above
critically important pattern support. We expect a modestly positive start to
the Markets on Wednesday. However, the overall reading remains very much on
similar lines and the 50-DMA and the levels of 9685 will remain critically
important levels to that the NIFTY will have to guard.
The levels of 9830 and 9865 will act as resistance levels
for Wednesday. Supports are expected to come in at 9710 and 9685.
The Relative Strength Index -- RSI on the Daily Chart is 42.7262 and it
remains neutral showing no divergences of any kind against the price. Daily
MACD stays bearish while trading below its signal line. No significant
formation was observed on Candles.
The pattern analysis shows that the Markets are desperately hanging
on to the lower support line of the multi-month channel that it has been
trading in. The previous immediate low of 9685 also happens to be the filter
levels of 50-DMA and therefore this pattern support along with these levels
will have to be critically observed.
All and all, it is of paramount importance that NIFTY crawls
back above its 50-DMA level once again. If it crawls back above 50-DMA, then
even if the Markets continue to consolidate, the weakness can be averted. However,
more the NIFTY persists below 50-DMA, greater will be the probability that it
will tests its filter and previous support point of 9685. We continue to
recommend extremely cautious and stock specific view on the Markets for today.
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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