MARKET OUTLOOK FOR WEDNESDAY,MAY 09, 2018

MARKET OUTLOOK FOR WEDNESDAY,MAY 09, 2018

Following a strong surge on Monday, Tuesday’s session failed to see any follow up move and the Markets once again faced consolidation on expected lines. The NIFTY failed to move past the 10785-mark and chose to consolidate in a range. The indexes headed nowhere and continued to oscillate in a given capped range. The NIFTY ended on a flat note gaining 2.30 points or 0.02%.

We keep our analysis on similar lines for Wednesday’s trade. We expect the Wednesday’s trade to begin on a quiet note and in all likelihood; we will see the Markets continuing with consolidation. We will continue to see the levels of 10785 continuing to act as immediate resistance area for the Markets.

We expect the levels of 10755 and 10785 to act as immediate resistance levels. Supports come in at 10690 and 10660 zones.

The Relative Strength Index – RSI on the Daily Chart is 63.7060. It continues to remain neutral showing no divergence against the price. Daily MACD still stays positive while trading above its signal line. No significant formations were observed on Candles.

The pattern analysis of the Daily Charts also does not present any different picture. The NIFTY has broken out from a broad rectangle formation, tested highs at 10785 and then has shown a throwback followed by some consolidation once again.

Overall, the current structure of the Charts has established the levels of 10785 as the immediate short term resistance level for the Markets. For any sustainable up move to emerge, NIFTY will have to move past the 10785-mark. Unless that happens, a sustainable resumption of up move will continue to elude us exposing Markets to some more consolidation in a capped range. We will see stock specific performances dominating the trade landscape. Market breadth will also be important to be watched. We recommend keeping exposures moderate and adopt stock specific approach for the day.

STOCKS TO WATCH:

Favorable technical set up is seen in stocks like EXIDE INDUSTRIES, BANK OF BARODA, IDEA, L&T FINANCE, FIRST SOURCE SOLUTIONS, DLF, and RELIANCE INDUSTRIES.

(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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