MARKET REPORT January
05, 2015
After spending couple of session while resisting to its
50-DMA, the Markets saw a strong uptick in Friday’s session wherein it ended
the day with decent gains. The Markets saw
positive opening and post such decently positive opening, the Markets
really never lost ground throughout the entire session. The Markets posted
decent opening and then trade in sideways trajectory for some time until
entering the afternoon session. The second half of the session saw some more betterment
as the Markets surged ahead and went on to post the day’s high of 8410.60 in
the late afternoon trade. It pared some minor gains from those levels but
finally ended the day at 8395.45, posting a decent gain of 111.45 points or
1.35% while forming a distinctively higher top and higher bottom on the Daily
Bar Charts.
MARKET TREND FOR MONDAY, JANUARY 05, 2015
Speaking purely on technical terms, the Markets have posted
an breakout above its 50-DMA which it had broken on its way down and had become
an resistance and therefore, has successfully continued with the pullback.
Expect the Markets to open on a positive note and continue with its up move at
least in the initial trade. In event of consolidation, the 50-DMA levels will
now again act as support.
The levels of 8435 and 8490 would act as immediate resistance
and the support would come in at 50-DMA in form of 8310.
The RSI—Relative Strength Index on the Daily Chart is
57.6989 and it remains neutral as it shows no bullish or bearish divergence.
The Daily MACD has reported a positive crossover and it now trades above its
signal line and is therefore bullish. On Weekly Charts, the RSI is 63.5144 and
it remains neutral without showing any bullish or bearish divergence. The
Weekly MACD is still bearish as it trades below its signal line but at the same
time has flattened out and can attempt a positive crossover in coming Weeks.
On the derivative front, the NIFTY January futures have
added over 2.87 lakh shares or 1.36% in Open Interest. This signifies further
creation of longs and rules out any possibility of short covering in Friday’s
session.
Returning to trend and pattern analysis, the Markets had
been resisting to the 50-DMA levels, the levels which it broke on downside.
When the Markets attempted pullback, this very level, which was a support earlier,
had now become a resistance. The Markets resisted for couple of days to this
level and it finally moved past it. Some more gains can be fairly expected in
immediate short term.
Overall, the Markets are likely to extend their gains in the
immediate short term. Some few days of range bound consolidations cannot be
ruled out but overall trend certainly remains intact. One can continue to make
moderate quality purchases. Overall, while keeping an eye on existing profits,
positive outlook is advised for the day.
Milan Vaishnav,
Consulting Technical Analyst,
Af. Member: Market Technicians Association (MTA), USA
Af. Member: Association of Technical Market Analysts, INDIA
www.MyMoneyPlant.co.in
Af. Member: Market Technicians Association (MTA), USA
Af. Member: Association of Technical Market Analysts, INDIA
www.MyMoneyPlant.co.in
+91-98250-16331
