The benchmark opened up with a gap up opening taking into account the positive global cues. This acted as a support to Nifty which looked to a bit tired and traders were anticipating of an impending correction. However the momentum picked in the mid-session with the steel sector outperforming the index with full strength. The buying was evident for the lower levels which suggest that even if the correction does occurs; it would be short term in nature and shallow bottomed.
The moving averages both short & medium term moving average (20 & 50 EMA) at 5327/5253 level would be acting as a strong support. The downside for the index looks capped and it would be better to trade with “buy on dips’ strategy. The chart of the index looks strong and resilient to any negative news flows and global developments. This could be the case where the index may touch newer highs in the medium to immediate time frame. The policy rate announcement by Reserve Bank of India (RBI) would be instrumental, not only in forming the economic prospects of the country but also the direction of the market for the next lap of advance.
The ADX is continuing with the rounding pattern on the charts which technically suggest a slow correction in the benchmark. Any bottom up formation in the ADX would be giving a push to the Nifty to cross the previous resistance. The previous session was marked by a decrease in the buyers rather than an increase in the sellers, as suggested by the moves in the +DI & -DI lines.
The MACD trend indicator is wobbling due to the frequent crossover in the MACD line and Signal line, which is an indication to the range bound markets in the present scenario. The range may be tepid for the sessions to come; a breakout could be sought after major policy announcement by the Central Bank and the expiry of the July series. The MACD Histogram is making non uniform which makes it difficult to anticipate the direction of the market even for the next session.
From the option data, the concentration of the volume is between the 5500/5400 NIFTY CALL and 5200/5300 NIFTY PUT. This suggests the range of the market before the expiry to be in between 5200 on the lower side and 5500 on the higher side. The increase in the Nifty Option Volume is the highest in case of the 5500 NIFTY CALL, which is a bullish signal for the markets; in this case the index is increasing with high increase in the open interest of the 5500 NIFTY CALL OPT, giving a clear signal of bulls concentrating on the higher level for an intermediate to near term.
As suggested in the newsletters, the Slow Stochastic momentum indicator is now trading near the 50 levels. A sideways movement could be expected with this indicator which would provide a range bound motion of the benchmark. However in case the indicator continues its journey towards lower levels then it would be the case of a limited downside to the markets. We expect Nifty to trade in the range of 5355-5415.
The moving averages both short & medium term moving average (20 & 50 EMA) at 5327/5253 level would be acting as a strong support. The downside for the index looks capped and it would be better to trade with “buy on dips’ strategy. The chart of the index looks strong and resilient to any negative news flows and global developments. This could be the case where the index may touch newer highs in the medium to immediate time frame. The policy rate announcement by Reserve Bank of India (RBI) would be instrumental, not only in forming the economic prospects of the country but also the direction of the market for the next lap of advance.
The ADX is continuing with the rounding pattern on the charts which technically suggest a slow correction in the benchmark. Any bottom up formation in the ADX would be giving a push to the Nifty to cross the previous resistance. The previous session was marked by a decrease in the buyers rather than an increase in the sellers, as suggested by the moves in the +DI & -DI lines.
The MACD trend indicator is wobbling due to the frequent crossover in the MACD line and Signal line, which is an indication to the range bound markets in the present scenario. The range may be tepid for the sessions to come; a breakout could be sought after major policy announcement by the Central Bank and the expiry of the July series. The MACD Histogram is making non uniform which makes it difficult to anticipate the direction of the market even for the next session.
From the option data, the concentration of the volume is between the 5500/5400 NIFTY CALL and 5200/5300 NIFTY PUT. This suggests the range of the market before the expiry to be in between 5200 on the lower side and 5500 on the higher side. The increase in the Nifty Option Volume is the highest in case of the 5500 NIFTY CALL, which is a bullish signal for the markets; in this case the index is increasing with high increase in the open interest of the 5500 NIFTY CALL OPT, giving a clear signal of bulls concentrating on the higher level for an intermediate to near term.
As suggested in the newsletters, the Slow Stochastic momentum indicator is now trading near the 50 levels. A sideways movement could be expected with this indicator which would provide a range bound motion of the benchmark. However in case the indicator continues its journey towards lower levels then it would be the case of a limited downside to the markets. We expect Nifty to trade in the range of 5355-5415.
TEAM SLT
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