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Range bound with positive bias

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Range bound with positive bias

Market saw another bearish day yesterday in the aftermath of Infosys result & poor IIP numbers. The drag of 12th -July has retraced almost the 40% rise that we had seen from 5195 on 20th June to 5740 on 8th July. Now indices are very near to its strong support zone between 5450 & 5500. Looking to the daily chart structure, the very short-term outlook can now become positive only if Nifty futures manage to cross 5600 otherwise the downtrend will continue. On a longer-term perspective, the chart suggests that we are once again stuck in a band above 5450 & below 5750 with a positive bias. However, this bias can turn negative once Nifty closes below 5450.
Today after a gap up opening markets have attempted to cross the resistance level of 5600 but, failed & is currently trading at 5585. Looking to the advance decline ratio, which seems encouraging (2:1) at this point of time, gives a sense that indices are finding good buying interest at lower levels. In the coming days, the market is likely to become choppy with stock specific activity increasing as result season has begun.

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Written by Rakesh Gandhi

July 13, 2011 at 3:55 pm

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Market update

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The markets paused yesterday after a 3 day rally from 5185 to 5505 on Nifty (and 17295 to 18361 on Sensex) almost 6% up from the lows formed last week. As this pull back is witnessed after markets corrected 16% from their recent top it needs more time to consolidate above the recent lows for confirmation of a bottom. On a very short term basis benchmark indices need to stay above 5440/18200 for the existing rally to continue. There could be a case of bottom formation if the last week’s low holds, even if there is adverse news affecting market sentiments.

I would believe if this happens then, we could see consolidation happening below 5700 & above 5250 for few weeks before it once again catches upward trajectory. Today any move past 5525 levels on Nifty can create strong upward momentum & that could be possible if Bank Nifty crosses 11000 levels.

Written by Rakesh Gandhi

February 17, 2011 at 12:47 pm

Posted in Market Update

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Markets at 1pm.

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The markets witnessed a nasty fall on Friday, as Nifty hit a low of 5356 levels on an intraday basis, the low of the week, after falling sharply from an intraday high of 5556. The closing on Friday was a bearish signal and it was also below the 300 EMA on daily charts. Based on the technical chart patterns 5350 and 17800 are the strong support levels for Nifty and Sensex respectively.

Further if we look at the retracement indicator, 66% of the rise from May 2010 will be retraced at a level of 5300. So observing to all the possible angles of technical study there is a strong possibility that markets may be finding a bottom in this range. ON the flip side an upmove can be said to resume only if the markets sustain above 5700 levels on Nifty, till then all the rise will be considered as just price noise in the process of bottom formation.

Written by Rakesh Gandhi

February 7, 2011 at 1:06 pm

Posted in Market Watch

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Markets Rise & Fall

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Markets have been extremely volatile since the last few days as investors are trying to fathom out the bottom in the near term. A quick look at the technical picture of our markets depicts key supports placed between the 100 and 200 EMA, which has a very important significance. Importance of 5700 and 19000 on Nifty and Sensex respectively, is now turning out to be ‘high octane’ stuff for the markets, judging by the reaction of the markets at these levels. Today the benchmark indices made a low of 19003/5695 & after inflation numbers it is now trading at 5830/19440 rising by almost 2% from the lows. On the negative side, breaking 5690/18950 on the downside will increase the intensity ‘southwards’.

Technical pattern formations on daily charts indicate that there is a significant bottom formation seen at the levels of 5700/19000 on the benchmark indices, which proves to be a crucial support for the market, in the absence of no negative news flow thereafter.

Written by Rakesh Gandhi

January 15, 2011 at 9:34 am

Markets Today

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Markets had shown a strong pull back after announcement of the IIP numbers yesterday. Critical level of 5700 & 19000 on Nifty and Sensex respectively, was not broken during the volatile period that we have seen in the last two trading sessions.

Formations on daily chart indicates that there is a significant bottom formation seen at the levels of 5700/19000 on the benchmark indices which can prove to be a crucial support if we do not see any further negative news flow.

Today the markets have recovered from intraday lows during the first half but it could not sustain thereafter and gave away yesterday’s gains completely. Volatility has been at peak since the start of this week & I think this kind of volatile moves makes strong case of bottom formation. Nifty future is indicating down trend at this point of time, however, once it crosses 5850 upward momentum will increase.

Written by Rakesh Gandhi

January 13, 2011 at 3:55 pm

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Markets Bleed

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Down-graphNifty and Sensex registered their biggest % fall since the last few months. Benchmark indices shed more than 2% in value. Stocks whereas have registered more than 10% on an average since the last 5-7 trading sessions.

The selloff was widespread, as no sectors were spared. What was frightening was the pace of the selloff. Also with a trading holiday tomorrow investors would want to unwind their positions, given the kind of selloff seen in the global (China especially) markets.
The advance decline ratio of 1:11 itself suggests the entire picture.

The European markets opened on a negative note, and seeing the selloff in global markets, these indices too extended their losses. During the time of writing this article, the European indices were trading 1-1.5% down.

Dollar index maintained its strength and was trading above 78.5 levels. Silver MCX was down 750 Rs and is trading below 39k levels.

Top gainers in the trade today included Educomp(8.5%) and BataIndia(4%).
Satyam carried its downward trend from the ADR prices, and was down more than 11% in today’s trade.

Whether today’s sharp selloff is just to trigger stop losses for all, or whether it is a signal of what worse is to come, would be clear only in the coming few trading sessions.

Written by Kunal Bothra

November 16, 2010 at 12:08 pm