WEEKLY MARKET OUTLOOK FOR SEP 25 THRU
SEP 29, 2017
All throughout previous Week, we kept on
sounding alert signs on the possibility of the NIFTY seeing sharp corrective
movements and chances of not sustaining the fresh highs that the benchmark
NIFTY50 was trying to mark. Very much in line with this analysis, not only did
the Index retraced from its high levels but also ended the week on a negative
note losing 121 points or 1.20% on a Weekly basis. In all probability, Markets
have marked the levels of 10180 as its temporary top and it will take a while
before the Markets take out those levels on the upside. However, the primary
uptrend remains intact.
The coming week will see the levels of
10150 and 10235 playing out as immediate resistance levels for the Markets.
Supports come in at 9890 and 9810 zones.
The Relative Strength Index – RSI on the
Weekly Chart is 63.3218 and it remains neutral showing no divergence against
the price. The Weekly MACD is bearish as it currently trades below its signal
line. On the Candles, an Engulfing Bearish Pattern has occurred. This is
very much likely to have bearish implications as it has occurred during an
uptrend. It has a potential to temporarily halt the up move.
The pattern analysis show that the NIFTY
continues to trade well within the upward rising channel formed over last
18-months. However, it has some room for retracement and even with coming off
from current levels; there won’t be any technical breach on the Charts.
It is important to note that though we may
cite any reason for the previous week’s decline, this retracement and halting
of up move was very much because of technical nature. The NIFTY PCR (Put to
Call Ratio) was at recent highs and the VIX traded at all time low. Technical
correction was imminent. We expect a subdued start to the expiry week on Monday
and continue to maintain cautious and stock specific approach to the Markets as
we see that even with the primary trend remaining intact, some corrective
activities may continue.
A study of Relative Rotation Graphs – RRG
show that in the coming week, we expect that IT Stocks are likely to take lead
and relatively out-perform the broader Markets. Metals are showing signs of
tiredness and are expected to show some slowdown and consolidate. REALTY and
FMCG stocks are not expected to put up and good show as well. We will see
PHARMA consolidating and select out-performance coming in from MEDIA, PSUBANKS
, NIFTY Junior and Infra stocks.
Important Note: RRG™ charts show you the relative strength and
momentum for a group of stocks. In the above Chart, they show relative
performance as against NIFTY Index and should not be used directly as buy or
sell signals.
(Milan
Vaishnav, CMT, MSTA is Consultant Technical Analyst at Gemstone Equity Research
& Advisory Services, Vadodara. He can be reached at
Milan Vaishnav, CMT, MSTA
Technical Analyst
(Research
Analyst, SEBI Reg. No. INH000003341)
Member:
CMT Association (Formerly Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
Society of Technical Analysts, STA (UK)
+91-70164-32277
/ +91-98250-16331
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.