MARKET OUTLOOK
FOR TUESDAY, JAN 02, 2018
Indian Equity Markets had a turbulent start to the new year
as the benchmark NIFTY50 remained range bound throughout the day but saw a
sharp decline in the last your of the trade. The Index ended the day losing 95.15
points or 0.90%. Though there is no technical breakdown on the Charts, the
Monday’s session remain technically important and it has certainly pushed the
NIFTY into some more time under consolidation. On Tuesday, we see a quiet
opening to the Markets. We may see some lower volumes as well as the
participation in the Markets will remain affected due New Year holidays.
The levels of 10465 and 10510 will play out as important
resistance levels to watch out for on Tuesday. Supports come in lower at 10380
and 10345.
The Relative Strength Index – RSI on the Daily Chart is 55.2808
and it remains neutral showing no divergence against the price. The Daily MACD
continues to stay bullish remaining in continuing buy mode. An engulfing
bearish candle has emerged. It remains significant as it has occurred at the
resistance zone of 10490-10535 and therefore it reinforces the credibility of
this resistance area.
The pattern analysis reveals the importance of the
10490-10535 support zones. The Markets have once again failed to confirm the
attempted breakout twice from these levels. This zone will continue to act as immediate
short term resistance for the Markets.
Failing to clear the 10490-10535 zones for the second time
has shown the credibility of this resistance area. Failure to clear the
10490-10535 zones has made some more consolidation imminent in the Markets.
There is no structural breach on the Charts but these levels will continue to
resist until we see a comprehensive breakout above this resistance area. Going
into trade on Tuesday, selection of stocks will hold the key. We recommend
avoiding shorts and trimming exposures with any potential up move and
protecting profits. Due to New Year holiday season, the volumes will remain
affected and this may also infuse some lack of depth and volatility in the Markets.
Cautious 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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