MARKET OUTLOOK FOR MONDAY, MAR 26, 2018

MARKET OUTLOOK FOR MONDAY, MAR 26, 2018

On the last trading day of the Week as well, global markets continued to affect the Indian Markets. Though the Indian Markets came off from their lows before they ended the day but still the benchmark NIFTY Index closed the day with net loss of 116.70 points or 1.15% on Friday.

As we enter the fresh week, the caution will prevail as we have a short week with Wednesday being the last trading day and also the expiry day of the current derivative series. Given the persistent weakness in the global trade, we may see a modestly negative opening once again. However, that being said, the Friday’s low of 9951 will be critical support level to watch for. It may happen that we open lower, but do not breach 9950 and improve in the later part of the day.

The levels of 10075 and 10110 will act as immediate resistance area for the Markets. Supports come in at 9950 and 9920 zones.

The Relative Strength Index – RSI on the Daily Chart is 32.1077 and it shows bullish divergence against the price as while NIFTY formed a fresh 14-period low, the RSI did not do so. The Daily MACD stays bearish trading below its signal line. A falling window occurred on Candles. This is essentially a gap down and implies a continuation of downtrend. But with the NIFTY forming a white body, there are fewer chances that it may have a have a lesser impact in the present context and scenario on the Charts. However, everything will need a confirmation on the following candle.

Pattern analysis shows that NIFTY showed a minor pullback and resisted to the 200-DMA midweek. This forming a formidable resistance area, the NIFTY continued to decline at Close levels while continuing to resist to the 200-DMA.

While keeping in mind that Global Markets will trade more days than Indian Markets, caution is certainly to prevail on our Markets. This cautionary approach may not see our Markets pulling back significantly or attempt to reverse the trend in this week itself. The current downtrend may persist but the Markets are now overdue to attempt a technical pullback though the levels of 200-DMA will continue to pose immediate resistance. Now lows may not easily be formed or sustained. Some minor technical pullback can be expected any time.

STOCKS TO WATCH:

Resilient technical setup is observed in stocks like CGPOWER, OIL, MARICO, ITC, ICC, IDEA CELLULAR, DISH TV, BHEL, NHPC, HCLTECH, COAL INDIA, TVS MOTORS and ASIAN PAINTS.

(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 known as Market Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA), CANADA
Society of Technical Analysts (STA), UK 
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