MARKET OUTLOOK FOR FRIDAY,JUNE 29, 2018

MARKET OUTLOOK FOR FRIDAY,JUNE 29, 2018

In our previous note, we had feared about possible breakdown in NIFTY if the levels of 50-DMA are not held at Close levels. On  these lines, the NIFTY continued with its slide on Thursday’s session and the benchmark index ended the day losing 82.30 points or 0.77%. Relatively speaking, the session remained less volatile given the fact that it dealt with the expiry of the June series.

As we step into Friday’s trade, speaking on broad terms, we are likely to see some more weakness persisting in the Markets. The nearest support that is seen is at 100-DMA which stands at 10530. It would be important to see if this remains sacrosanct and respected by the Markets.

Friday is likely to see the levels of 10630 and 10655 to pose resistance at higher levels. Supports come in at 10530 and 10480 zones.

The Relative Strength Index – RSI on the Daily Chart is 41.1590 and it has gone on to mark a fresh 14-period low which is bearish. It shows no divergence against the price. The Daily MACD stays bearish while trading below its signal line. No major formations were observed on Candles.

Going by the pattern analysis, it is now pretty evident that the NIFTY has as of now failed to navigate and move past the pattern resistance of the falling trend line. Going further, the NIFTY has shown a downward breakdown from the large symmetrical triangle formation.

Overall, we might see NIFTY attempting to gain some stability, but the current break of the pattern formation has made one point clear that going ahead is not likely to be smooth for the NIFTY going ahead. We will see this pattern that is breach likely to  act as resistance for the Markets going ahead. We recommend paring exposure in high beta stocks and returning to large caps that offer more safety moving forward. It is advised to take extremely cautious view on the Markets and avoid major exposures while remaining highly selective in approach towards any fresh purchases.

STOCKS TO WATCH:

Relatively resilient technical set up is observed in stocks like CG POWER, PNB, NATIONAL ALUMINUM, NTPC, ADANI PORTS, NBCC, LARSEN TOUBRO, JSW ENERGY and LT FOODS.

(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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