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Market Momentum

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Markets today have once again shown signs of nervousness and the trend that I have been noticing for the last few days is that volatility is key without any conclusive direction. There have been many false signals emerging in last few weeks.

To maintain the upward trajectory today Nifty needs to stay above 5450, below which it could once again go down to 5400. The increase in  volatility does not signify anything unless, eventually it breaks out of range of 5225 or 5545 levels on closing.

Based on the chart formations a strong tussle between the bulls & bears is currently underway. In last few weeks we have seen domestic scams, outflow of funds from emerging markets, rise of crude on Middle East concerns, Japan earthquake and tsunami coupled with the scare of nuclear fallout effects thereafter and the RBI policy, out yesterday. All of the news flow has been absorbed while markets traded between this range of 5225 & 5550. From here markets needs a strong reason to breakout from this range bound trading & only then can we could see increase in momentum.

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Written by Rakesh Gandhi

March 18, 2011 at 12:34 pm

Markets Today

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Though the indices opened with a gap down yesterday, an immediate recovery was seen in the early morning trades. Volumes were low while indices closed near the resistance level. As we had been discussing in last few days 5400 and 18000 is now trend changing level between the band of 5225 to 5545. On upside 5545 & 18500 is key level above which we expect market to touch 5700.

We have been mentioning this possibility for the last few days as the expected completion of bullish pattern will be seen once the market closes above 5545/18500. Further momentum is also likely to increase as soon as 200 DMA is crossed.

It would also be worthwhile for traders to watch how the bank nifty behaves near the breakout level of 11100. Today markets have already attempted to cross 5545 in early morning trade but at this point are trading at 5500 levels which is a cause of concern. To maintain the upward trajectory today Nifty needs to stay above 5450, below which it could once again go down to 5400. The increase in  volatility does not signify anything unless eventually it breaks out of range of 5225 or 5545 levels on closing.  Based on the chart formations a strong tussle between the bulls & bears is currently underway and believe the bulls may come out on top.

Written by Rakesh Gandhi

March 9, 2011 at 3:22 pm

Posted in Market Watch

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Markets Today

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It was mentioned that downward pressure will increase once the markets break the 5380 level, evidently this happened at a rapid speed owing to the last day of expiry & global worries. Now we are at the threshold of retesting the bottom formed 2 weeks ago.

There is possibility of this occurrence in next two days except that a bearish move has already begun and it would be important to watch for signs of strength and the regaining lost ground. For regaining strength, the market needs to bounce back above the 5400 levels and if not, we may see indices breaking the lows made on 11-Feb 2011 and fall further, in that case the nearest support seen from current levels is at 17200/5100.

Based on the technical charts 500EMA is currently placed at 5150 as well as based on the long term weekly formation of a support trend line  that is placed around this levels.  As a result, we could see panic if this levels are broken. After the announcement of budget indices at the very least need to  cross & sustain above 5430/18000 which can pull the bulls back into action otherwise the downward trend will continue.

 

Written by Rakesh Gandhi

February 25, 2011 at 3:10 pm