Archives : MARKET AT CRITICAL LEVELS - 10/04/2015.

MARKET AT CRITICAL LEVELS - 10/04/2015. 

BULLS CONTINUE THE GOOD WORK.

The bulls continued to show strength for second week running and taking the market very close to critical levels. Nifty has closed just shy of the 8800 level and Sensex just short of 29000, which makes the coming week a very interesting week to watch out for. But as the market has moved higher, we have a strong intermediate bottom in place which is at Sensex 27248 and Nifty 8269. This bottom is coinciding with the long term average of 200dma, which makes this bottom even more significant. A break of this bottom will pave the way for Nifty to test sub-8000 levels.

 

 


MARKET AT CRITICAL LEVELS - 10/04/2015. 

BULLS CONTINUE THE GOOD WORK.

The bulls continued to show strength for second week running and taking the market very close to critical levels. Nifty has closed just shy of the 8800 level and Sensex just short of 29000, which makes the coming week a very interesting week to watch out for. But as the market has moved higher, we have a strong intermediate bottom in place which is at Sensex 27248 and Nifty 8269. This bottom is coinciding with the long term average of 200dma, which makes this bottom even more significant. A break of this bottom will pave the way for Nifty to test sub-8000 levels.

TECHNICALLY SPEAKING.

Sensex opened the week at 28351, made a high of 28907, low of 28221 and closed the week at 28879. Thus it closed the week with a gain of 619 points. At the same time the Nifty opened the week at 8615, made a high of 8787, low of 8573 and closed the week at 8780. Thus the Nifty closed the week with a gain of 194 points.

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                On the daily charts, Sensex has formed a Doji formation whereas Nifty has formed a white body Spinning Top. Both these are neutral formations and the immediate market direction will be dependent on the next day’s candle. On the weekly charts, both the indices have formed a real white body candle which is like a confirmation after completing a Bullish Harami last week. Thus daily charts are undecided but the weekly pattern suggests continuation of bullishness in the near term.

The market continued with its pull-back and the indices covered lot of lost ground. Both Sensex and Nifty are nearing to testing the 61.8% Retracement level (Sensex – 28964 and Nifty – 8794). This level coincides with a minor top and hence this is a strong Resistance zone. Thus any closing above 28964-28978 for the Sensex and 8788-8794 for the Nifty will pave the way for indices to retest the prior top.

Both the indices have seen a strong pull-back from Sensex 27248 and Nifty 8269 which is now a strong intermittent bottom as it coincides with the long term average of 200dma. Thus a breach of this level will make way for the Nifty to test levels of 8000 and below.

Both the indices have already completed a Bearish Rising Wedge pattern and the target for which falls at 26049 for the Sensex and 7882 for the Nifty. This pattern will get negated only if we have closing above Sensex 30024 and Nifty 9119.

The market bounced back this week and has managed to conquer the short term average of 20dma (Sensex – 28351 and Nifty – 8607) and even the medium term average of 50dma (Sensex – 28772 and Nifty – 8716). Also both the indices continue to stay well above the long term average of 200dma (Sensex – 27339 and Nifty – 8212). Thus the trend in the short term and medium term timeframe has turned up whereas the trend in the long term timeframe still continues to remain bullish.

MACD and Price ROC both continue with their buy signal. RSI (59) has moved higher suggesting bullish momentum. Stochastic Oscillator %K (94) remains above %D and hence in Buy mode. MFI (65) has moved higher which suggests positive money flow. ADX at 14 suggests that the market is in a wide trading range. Directional Indicators continue in Buy mode as +DI continues to remain above –DI. Thus majority of Oscillators have turned bullish and suggest a bullish bias in the near term. 

Option data suggest highest Put Open Interest buildup is at the strike of 8500 and highest Call build-up is at the strike of 9000. Thus Option data suggests a trading range with support coming in at 8500 and resistance around 9000. Friday saw strong Call writing at the 8800 strike which will act as an immediate resistance level.

INDEX LEVELS:

S3

S2

S1

CLOSE

R1

R2

R3

Nifty

8470

8570

8669

8780

8913

8996

9119

Sensex

27786

28197

28584

28879

29183

29522

29844

LAST WEEKS RECOMMENDATIONS:

STOCK

Reco. Price

Tgt

Reached

Lot Size

Profit

AuroPh

1247

1312

1382

250

Rs.33,750

Buy MCX

1176

1214

1184

250

Rs. 2,000

Buy Bharti

402

419

422

500

Rs.10,000

SKSMicro

467

506

525

500

Rs.29,000

Buy Idea

189

196

199

2000

Rs.20,000

Total

Rs.94,750.

THIS WEEKS RECOMMENDATIONS:

STOCK

CMP

SL

Tgt-1

Tgt-2

Buy DivisLab

1938

1899

1999

2061

Buy BFUtilities

834

814

866

899

Buy WelspunInd

397

384

417

438

Buy Voltas

306

298

319

333

Buy Polaris

169

164

177

185

WATCH OUT FOR:

POLARIS

Disclaimer : The recommendations made herein do not constitute an offer to sell or a solicitation to buy any of the securities mentioned. No representations can be made that the recommendations contained herein will be profitable or that they will not result in losses. Readers using the information contained herein are solely responsible for their actions. Information is obtained from sources deemed to be reliable but is not guaranteed as to accuracy and completeness.

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