'Long-legged Doji' ; Indecision
A volatile session of trading saw the Nifty trade in a 91 points range and end above the 7400 mark. The index opened on a flat and traded in a choppy manner throughout the session but was resisted by the cluster of 21 & 50 hourly EMAs. Trading volumes clocked at average levels whereas the market breadth continued to remain weak at 5:9 in favor of decliners. Volatility (India VIX) ticked slightly down to 18.20% but remains in an underlying upward bias. Daily charts display a 'long-legged doji' candlestick pattern that signifies indecision among market participants and thus yesterday's range of 7365 and 7457 remain crucial pivots to determine the direction in the near-term. Nifty has managed to retrace approx. 66% of the up move and could exhibit a rebound as 7400 acts as a good support based on options open interest concentration. Momentum oscillators continue to show mixed readings with MACD triggering a buy crossover. It is prudent to have a neutral short-term stance and act on break of yesterday's range in either direction.
Trend among sectoral indices was largely bullish led by gains in Metals (+2.5%), Cap Goods (+1.9%) and IT (+0.9%) indexes; whereas marginal losses were posted in shares from Healthcare (-1.5%) and Realty (-0.3%). Broader market Mid-cap and Small-cap indices underperformed their frontline peer with losses of -0.2% and -0.75% respectively.
Bullish Setups: AXSB, TCS, INFO, ACEM, AXSB, BHARTI
Bearish Setups: RCAPT, JUST, JETIN, TATA, APHS
| Nifty Index |
|
| Bloomberg Code | NIFTY Index |
| Spot Price | 7404 |
| Resistance 1 | 7447 |
| Resistance 2 | 7487 |
| Support 1 | 7350 |
| Support 2 | 7300 |
| Nifty 20 SDMA | 7460 |
| Nifty 50 SDMA | 7674 |
| Nifty 200 SDMA | 8062 |
| Adv : Dec [NSE] | 585 : 968 |
| Turnover Rs Crs. BSE+NSE cash | 19,640 |
| Oscillators | Comments |
| RSI | Neutral |
| MACD | Bullish |
| Stochastic | Bearish (OS) |
| DMI & ADX | Bearish & Non Trending |
* OB: Over Bought
OS: Over Sold
Edelweiss Technical Reflection (ETR): " 'Long-legged Doji' ; Indecision " (05-Feb-16-EDEL)
Regards,
Tejas J. Shah +91 22 4063 5534
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