Markets have snapped the five session winning streak with a sharp cut of 1.3% to close a shade above 7600. Nifty climbed to a higher high of 7749 at the start and began to slip lower for the day with the fall accelerating in the second half of the session and only saw some recovery in the final 30 minutes. It has managed to close below the 21 & 50 hourly EMAs but has managed to hold above the 12 day SMA (7585). Nevertheless, on daily charts Nifty has formed bearish 'key reversal / outside bar' and thus unless the high of 7749 is not taken out, expect the index to get into declining mode. Trading volumes clocked at average levels whereas the market breadth was weal at 1:4 in favor of decliners. Volatility (India VIX) has spiked up to 17.5%, thus recovering from lower band of its range. Momentum oscillator readings on hourly charts had warned of corrective risks and now have rolled into bearish territory, meanwhile the daily readings continue to remain in bullish mode thus giving mixed signals. With heavy resistance placed at 7750-7780 Nifty seems to have got into a corrective mode and should now retrace the up move from 6825 to 7749 with key levels at 7400 and 7290. In the near-term support continues to be pegged at the 21 day EMA at 7493 which should hold until March expiry. Hence one should look to sell any pullback rallies to 7665 with stop-loss at 7749.
A secular downtrend was seen among sectoral indices led by losses in Realty (-4.35%), Metals (-3.92%) and Telecom (-2.2%); whereas relative outperformance was seen in Oil & Gas (-0.34%) and IT (-0.48%) indexes. Broader market Mid-cap and Small-cap traded in line with their frontline peer with losses of -1.36% and -1.65% respectively.
Bullish Setups: AL, TCS, INFO, AXSB, LT
Bearish Setups: HNDL, TATA, APHS, JSTL, Z, MRCO
| Nifty Index |
|
| Bloomberg Code | NIFTY Index |
| Spot Price | 7615 |
| Resistance 1 | 7685 |
| Resistance 2 | 7713 |
| Support 1 | 7587 |
| Support 2 | 7550 |
| Nifty 20 SDMA | 7445 |
| Nifty 50 SDMA | 7366 |
| Nifty 200 SDMA | 7899 |
| Adv : Dec [NSE] | 347 : 1254 |
| Turnover Rs Crs. BSE+NSE cash | 20,151 |
| Oscillators | Comments |
| RSI | Bullish |
| MACD | Bullish |
| Stochastic | Bullish (OB) |
| DMI & ADX | Bullish & Trending |
* OB: Over Bought
OS: Over Sold
Edelweiss Technical Reflection (ETR): " Key Reversal / Outside Day " (29-Mar-16-EDEL)
Regards,
Tejas J. Shah +91 22 4063 5534
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