INSUBCONTINENT EXCLUSIVE:
The Index gained 39.10 points or 0.37 per cent, but showed no conviction on either side.
As we approach the last trading day of the week, we
The market is showing a lot of inherent buoyancy, but if we speak about the immediate short term, some consolidation is now getting long
overdue.
It would be healthy for the market if it spends some time oscillating in a capped range
10,580 and 10,625 acting as resistance levels
Supports have shifted littler lower at 10,510 and 10,465 zones.
The Relative Strength Index (RSI) on the daily chart is 62.8027
While it marked a fresh 14-period high, it remained neutral against the price showing no divergence.
While daily MACD continued to stay
bullish, no significant formations were observed on the candles.
Pattern analysis of the daily charts showed that the market is trying to
break out from the pattern resistance area
The market is trying to break out from a rectangle formation, which resulted out of a broad trading range.
Overall, it is beyond doubt that
the inherent buoyancy in the market is quite visible
However, the current structure on the daily charts looks bit overstretched and possibilities of a profit taking from higher levels cannot be
ruled out.
The Nifty PCR (Put to Call ratio), which is at relatively higher levels might restrict the upmoves as well
We strongly advise to refrain from creating shorts as the undercurrent remains bullish
However, with possibilities of market encountering volatile profit taking bouts at higher levels, vigilant protection of profits is
advised.
While adopting a very cautious view on the market, all profit taking bouts, if any, should be continued to be used for making
select purchases.
STOCKS TO WATCH: Fresh long positions were seen being added in Vedanta, JSW Steel, National Aluminum, IFCI, South Indian
Bank, Tata Motors, Godrej Properties, Century Textiles, ITC, Power Grid, Larsen Toubro and ONGC.
(Milan Vaishnav, CMT, MSTA is Consultant
Technical Analyst at Gemstone Equity Research Advisory Services, Vadodara
He can be reached at milan.vaishnav@equityresearch.asia)
