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Edelweiss Technical Reflection (ETR)
- Contrary to the trend prevailing since the last couple of days, Nifty opened on a positive note, and gradually traded higher throughout the first half. It tested the hourly moving averages of 6050 and 6065 as well as retraced 50% of the down move from 6151 to 5987. The last half of hour of yesterday’s quadruple witching day, saw a spike in volatility and a collapse in the index. It broke below the 6000 level without any fight, but surprisingly managed to hold above the crucial 5965 support. Volumes were significantly higher owing to the expiry. Bearish readings on momentum indicators continue to add pressure. Market wide breadth continues to be in favor of declines. Nifty stocks’ breadth turned dismal at 1:2.5. A daily close below the crucial 6000 mark, as well as a sell signal from various technical parameters is likely to keep the downward pressure on the index. A break and close below 5965 would open up downside towards 5840 (equality of previous down move). On the flipside, if 5965 is held, then the range trade between 5965-6125 would continue until a decisive breakout is achieved.
- Realty, Consumer Durables and Power stocks were among the major losers. Meanwhile Autos, Telecom and IT shares witnessed buying interest. Bullish Setups:RIL, TATA, CIPLA, HH, IDBI. Bearish Setups: SESA, CAIR, ICICIB
- European equity indices traded higher throughout yesterday’s session on positive economic data and an underline uptrend. US markets are oscillating in a choppy session, ahead of the crucial GDP data to be released today as well as close of the October (omen) month. DXY has reacted sharply lower from the 21 daily EMA against a positive immediate short-term uptrend.
- Interesting chart setups: RIL, TATA, CIPLA, SESA
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