MARKET OUTLOOK
FOR FRIDAY, JAN 05, 2018
After a range bound consolidation in the first half of the
session, the benchmark NIFTY50 extended its gains on Thursday while it closed
with net gains of 61.60 points or 0.59%. With this, the Markets have made yet
another attempt to breakout above the 10490-10535 zones. Going into trade on
Friday, we expect a quiet to positive opening in the Markets. Though the
session will remained dominated with select pockets of out-performance, we
expect the up move to continue while the NIFTY attempts to break free of the
10490-10535 resistance zones.
The levels of 10535 and 10630 will play out as resistance
area for the Markets in event of continuation of up move. The supports come in
at 10490 and 10435 area.
The Relative Strength Index – RSI on the Daily Chart is 60.0085
and it remains neutral showing no divergence against the price. The Daily MACD
is bullish while it trades above its signal line. On the Candles, a white body
occurred. The present structure on the Candles does not offer any significant
formations.
Going by pattern analysis, it is clear that the 10490-10535
zones have been offering stiff resistance for the Markets. A narrow congestion
area has developed and the NIFTY is seen oscillating in a capped range over
some days now. It has made an attempt to break above this area again. The RSI
is seen forming higher bottoms as well while continuing to stay neutral.
Overall, though no break out has yet been achieved, the
NIFTY has certainly moved in a way that it attempts to breakout above 10490-10535
zones again. Friday’s opening would be crucial. It would be important for the Markets
to move past the 10535-mark. A confirmation to this is awaited. Unless NIFTY
moves past these levels, it may remain range bound and be once again pushed into
some more consolidation. Select pockets like stocks from PSU Banks, Financial
Services and Auto may attempt to relatively out-performing. While continuing to
avoid shorts, modest selective purchases may be made. Continuing to maintain
cautiously positive outlook is advised for the day.
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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