WEEKLY MARKET OUTLOOK FOR DEC 11 THRU DEC 15, 2017
The Indian Equity Markets recovered part of its previous
Week’s losses as the follow-up to the technical pullback continued and the
benchmark NIFTY50 ended the Week with net gains of 143.85 points or 1.42% on
Weekly basis. The gains in the Week that has gone by came much on the technical
pullback that the Markets witnessed on the last two days of the Week. In the
coming week, we feel that the follow-through to the pullback that happened
might extend into the next coming week as well. However, in the same breadth,
the Markets will find resistance going ahead and might get pushed into some
consolidation as well. Some eyes will
also remain on the Gujarat Polls which will have some sentimental effect as well.
However, going purely on technical ground as well, Markets face resistance once
again at higher levels.
The coming week will see the levels of 10350 and 10490
playing out as immediate resistance levels. Markets are not expected to easily
move past its previous highs that it has marked.
The supports come in lower at
10130 and 9980 zones.
The Relative Strength Index – RSI on the Weekly Chart is
59.6274 and it remains neutral against the prices. The Weekly MACD is bearish
as it trades below its signal line. No
significant formations were seen on Candles this week.
The pattern analysis makes it evident that the NIFTY has
taken support on the 100-DMA on the Daily Charts. However, this level also
coincides with the 20-WMA on the Weekly Charts. Without any damage to the
primary trend, there is still room for the Markets to consolidate. The Weekly
RSI has made a lower low and it still continues in that formation capping any
meaningful breakout for the Markets until this formation is breached on the
upside.
The coming week is likely to remain volatile as well. We
expect the Markets to face resistance in the and may face itself countering
some profit taking bouts from higher level once again. The Markets are likely
to once again become vulnerable to weakness above 10325-10350 levels. Specific
sectors are expected to stand out and picking the right stocks will be crucial
as we go ahead in the coming trading week.
A study of Relative Rotation Graphs – RRG evidently show the
coming Week will see the broader Markets relatively out-perform the NIFTY. The
stocks from NIFTY JR, and MIDCAPS are likely to see out-performance. Good
performance is also expected from PSUBANK Pack and ENERGY stocks accompanied by
MEDIA and INFRA. No major is expected from IT Pack and it is likely to
consolidate. METAL will continue to lose momentum on week-on-week basis. PHARMA
too may not see any meaningful gains on a weekly note. FMCG will continue to
consolidate and may attempt to strengthen its base.
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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