Edelweiss Technical Reflection (ETR)
§ The Nifty declined below crucial support of 6100 after 3 days of sideways consolidation. Late buying in the trading session brought the index back above 6080. Market breadth was weak throughout the trading session as Advance decline remained at 1:2 for Nifty as well as broader market. The steep upward rising trend channel has been broken and the nifty is now correcting in a declining trend channel. The momentum oscillators have cooled off substantially but remain in sell mode. Close above 6165 would lead to an upside break and end of the correction until which the downside pressure is likely to continue. Immediate support is now placed at 6040 which is just above the 20 SDMA.
§ No clear sectoral trend continuity was visible but there was definite sense of beta reduction in the market. Metals & Realty names declined and pared gains of last few days. Select names from Auto sector managed to depict some strength. Bullish Setups: RCOM, KTK Bank, IFCI, M&M Bearish Setups: HDFC Bank, Bharti, Ambuja and IOC
§ Major global indices have seen some weakness setting in last few trading sessions. SPX has remained comfortably above 1150 level although a contrarian TD Sequential sell signal is triggered here. JPY is near crucial resistance of 81 while Euro is also facing supply under 1.4. With crude also hovering around 82 mark, it appears that the entire risk assets are undergoing some sideways consolidation in the uptrend
§ Interesting chart setups: M&M
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