MARKET OUTLOOK FOR WEDNESDAY, MAR 14, 2018

MARKET OUTLOOK FOR WEDNESDAY, MAR 14, 2018

In what seemed to be a quiet continuation of an up move, the Markets turned volatile in the last hour and half of trade and ended up closing on a flat note. The benchmark NIFTY ended the day with a gain of 5.45 points or 0.05% after coming off nearly 100-points from the intraday high and then recovering 50-points before closing.

From the Tuesday’s trade, we can draw inference that the NIFTY chose to consolidate after it resisted to the 100-DMA which stands at 10456. NIFTY failed to penetrate these levels at Close and this levels hold out as resistance for the immediate short term.

While we approach Wednesday’s trade, there are chances that we see a modestly positive start to the trade once again. However, despite chances that NIFTY may attempt to move past its 100-DMA, it would be technically important for it to Close above the levels of 100-DMA.

Wednesday’s trade is likely to see levels of 10460 and 10515 playing out as resistance are for the Markets. Supports come in at 10410 and 10350 zones.

The Relative Strength Index – RSI on the Daily Chart is 48.3044 and it continues to remain neutral against the price showing no divergences of any kind. The Daily MACD has turned positive. It has reported a positive crossover and it is now bullish while trading above its signal line. No major formations were observed on Candles.

IF we look at pattern analysis, with the NIFTY pulling itself above the 10275-10300 zones, it has now once again entered the trading zone. Also, it has re-established the level of 10275 as its immediate important pattern support followed by the 200-DMA.

All in all, we might see some consolidation happening near the 100-DMA mark but overall the Markets are likely to exhibit a positive bias in the trade. There might be some  volatility getting ingrained once again and we might see this volatility playing out as well if the NIFTY deliberates near its 100-DMA. If the resistance persists near the 100-DMA mark for some time, it might result into some volatile profit taking bouts. However, until the NIFTY trades above the 10275-mark, all these dips should be utilized to make select purchases. While avoiding shorts and keeping overall positions moderate until a upward directional bias is established, continuance of positive outlook is advised for the day.

STOCKS TO WATCH:

Shorts were seen being added on counters like TCS, VEDANTA, INFOSYS, COAL INDIA, DABUR, BHEL, ARVIND, CASTROL INDUSTRIES and HINDALCO. Fresh longs were observed in stocks like CGPOWER, STATE BANK, ASHOK LEYLAND, RCOM, FEDERAL BANK, TV18 Broadcast and NCC.

(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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