MARKET TREND FOR TODAY
April 11, 2012
The Markets had an extremely range bound
session yesterday as it moved in a very narrow band in either direction and
ultimately ended the day with modest gains. The Markets opened moderately
negative but soon moved into positive
zone as it gave its intraday high of 5255.80. It however, pared its gains as it
gradually traded flat and further into negative territory by afternoon trade to
give its intraday low of 5211.85. It saw a v-shaped recovery towards the end of
the session, went almost to its intraday high levels and finally ended the day
at 5243.60, posting a moderate gain of 9.20 points or 0.18%. It has went on to
form a lower top and lower bottom on the Daily High Low Charts.
Today’s analysis would remain more or less
similar to that of yesterday and we will continue to see the Markets
consolidating without any significant breakdown and we may continue to see the
Markets trading volatile and range bound.
Expect the Markets to open on a moderately
negative note and look for directions. It will continue to heavily depend upon
the intraday trajectory for today’s trend and is likely to see lower volumes as
it continues to consolidate. The levels of 5290 and 5330 shall act as immediate
resistance on the Charts and the levels of 5205 and 5180 shall act as immediate
supports.
The RSI—Relative Strength Index on the
Daily Chart is 43.8265 and is neutral as it shows no negative divergence or
failure swings. The Daily MACD has turned bearish as it has reported a negative
crossover and now trades below its signal line.
Having said this, inspite of continuing
weakness, it is important to note that here is no negative breakdown or any
breach of pattern on the Daily Charts. The Markets continue to remain in a
broad trading range with the major support coming in in form of its 200-DMA which
is 5146. So even if the Markets drifts to that levels, there won’t be any
breach on the Charts. The Markets today are likely to consolidate and will see
trading in a range and some amount of volatility ingrained in it.
All and all, with the consolidation likely
to continue, it is advised to remain cautious and with no negative breach on
the Charts shorts should be avoided. On the other hand, aggressive longs
positions too should be avoided and profits be protected at higher levels. Any
dip should be used in making selective purchases as stock specific activity
would continue. Overall, moderately positive approach with caution is advised
for today.
Milan Vaishnav,
Consulting Technical Analyst,
+91-98250-16331
