WEEKLY MARKET OUTLOOK FOR NOV 27 THRU DEC 01, 2017
In our previous Weekly note, we had mentioned about the
levels of 10345-10365 acting as important resistance area for the Markets. In
the Week that went by, the NIFTY50 index continued to resist to these levels
for 4 days out of 5 and in the end, attempted to marginally move past it. The
benchmark NIFTY50 ended the week with net gains of 106.10 points or 1.03%. In
the coming Week, we have expiry coming up for the current derivative series. We
will see NIFTY50 oscillating in a broad range. We might see it inching higher
and make attempts to test its previous highs but a clear-cut fresh breakout may
still continue to elude us. Despite every marginal higher level that the NIFTY
may try and attempt, it will continue to remain vulnerable to profit taking
bouts at higher levels.
The levels of 10465 and 10535 will play out as upper
resistance area for the coming week. The lower supports that we can expect
exist at 10250 and 10130 levels.
The Relative Strength Index – RSI on the Weekly Chart is
66.2680 and it stays neutral for this week without showing any divergences
against the price. The Weekly MACD stays bullish as it trades above its signal
line. No significant formations were observed on Candles.
The Pattern Analysis makes it evident that the NIFTY still
continues to trade in a 22-month long trading Channel that it has created. It
resisted to this 22-month old upper trend line at 10490. However, this
resistance has now shifted higher and this has made some room for the Markets
to attempt small marginal highs. If we go by Classical Pattern Analysis once
again, any higher movement that the Markets may try and attempt will have no
strength if the lead indicators continue to throw up Bearish Divergences.
Overall, we expect the Markets to oscillate in a broad range over coming week.
Though primary trend may not be violated but in the same breath, we also do not
expect the Markets to race beyond its recent highs. The Week may remain largely
stock-specific.
A study of Relative Rotation Graphs – RRG show that the
METAL pack may see some individual performance but has overall continued to
lose momentum and may increase its under-performance against the benchmark,
i.e. NIFTY. We will see INFRA, MEDIA, and IT continue to grossly improve their
relative out-performance. Some stock specific out-performances may also be seen
from REALTY and MIDCAP universe. FMCG may slightly lag while AUTO Pack may
consolidate its performance. No major
relative out-performance may be expected from SERVICES, FINANCIAL SERVICES or
Bank NIFTY going ahead in this week.
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@equityresearch.asia
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
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