MARKET OUTLOOK FOR THURSDAY, OCT 05, 2017
Very much on expected lines, the Indian Equities continued with
their pullback as the benchmark NIFTY50 ended the day with net gains of 55.40
points or 0.56%. The NIFTY has breached the upward rising channel in the recent
decline and therefore, the upward rising trend line was expected to pose
resistance to the Markets. In line with this analysis, the NIFTY continued to
resist to this upward rising trend though the under current remained much
buoyant. Going into trade on Thursday, we continue to expect a modestly
positive start but the zones of 9915-9945 will continue to pose resistance to
the Markets. Once the Markets end the day above 9945 which is the 50-DMA, we
would be back into the upward trading channel.
The levels of 9945 and 9980 will act as resistance area for the
Markets. Supports come in at 9850 and 9815 zones.
The Relative Strength Index – RSI on the Daily Chart is 48.9364
and continues to remain neutral showing no divergences against the Price. The
Daily MACD continues to narrow its trajectory moving towards the positive
crossover in coming days. No significant formations are seen on Candles.
The pattern analysis show that the NIFTY is resisting to the
upward rising trend line of the rising channel formed over last couple of
months. This trend line was its support when the Index was trading inside the
channel. But after a negative breach, the same support is now acting as its
resistance.
Though the levels of 9945 remain a critical level to watch at Close,
there are higher chances that the NIFTY will be able to move past it in coming
days. All the up moves have come with a solid rise in Open Interest and this
may prevent major downsides and acts as a positive indicator. Banking stocks
will react to the RBI Policy review wherein it kept the rates unchanged but
slashed the SLR. While completely avoiding shorts, select buying may be
continued while maintaining a positively cautious view on the Markets.
Milan Vaishnav, CMT, MSTA
Technical Analyst
(Research Analyst, SEBI Reg. No. INH000003341)
Member:
CMT Association (Formerly known as Market
Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA),
CANADA
Society of Technical Analysts (STA),
UK
+91- 70164-32277
/ +91-98250-16331
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