Holding on to support
Nifty has managed to pullback from previous three session's weakness with gain of 0.20% to close a shade under 8600. The index opened flat and swung lower to test the lower boundary of the ascending broadening pattern low of 8540 and recovered sharply in the second half to close near highs of the day. The index continues to hold above its 21-DEMA thus keeping the short-term trend higher. Trading volumes clocked at above average levels whereas the market breadth ended at 2:3 in favor of decliners. Volatility (India VIX) fell to a fresh calendar year low of 14.20%. Momentum readings are throwing mixed signals and suggest a period of consolidation in the immediate near-term. Having tested the pattern lows and recovery thereafter, the index should attempt to rally back up to 8700 and 8820 thereafter. On the downside, a breach of 8520 will mark a topping pattern for potential downside target of 8300.
A mixed trend was seen among sectoral indices led by gains FMCG (+1.4%), Oil & Gas (+0.74%) and Power (+0.38%); whereas losses were posted in Realty (-0.9%), Metals (-0.7%) and Autos (-0.45%) indices. Broader market Mid-cap and Small-cap indices relatively underperformed their frontline peer with losses of +0.03% and -0.02% respectively.
Bullish Setups: TATA, ONGC, NHPC, KKC, JSW, APHS
Bearish Setups: ACC, OBC, ARBP, LPC, IIB
| Nifty Index |
|
| Bloomberg Code | NIFTY Index |
| Spot Price | 8592 |
| Resistance 1 | 8626 |
| Resistance 2 | 8656 |
| Support 1 | 8540 |
| Support 2 | 8517 |
| Nifty 20 SDMA | 8596 |
| Nifty 50 SDMA | 8394 |
| Nifty 200 SDMA | 7865 |
| Adv : Dec [NSE] | 624 : 967 |
| Turnover Rs Crs. BSE+NSE cash | 26,236 |
| Oscillators | Comments |
| RSI | Neutral |
| MACD | Bearish |
| Stochastic | Bearish |
| DMI & ADX | Bullish & Trending |
* OB: Over Bought
OS: Over Sold
Edelweiss Technical Reflection (ETR): " Holding on to support " (12-Aug-16-EDEL)
Regards,
Tejas J. Shah +91 22 4063 5534
Edelweiss Research is also available on Bloomberg EDEL <Go>, Thomson First Call, Reuters and Factset. Please write to us in case you need any assistance in this respect.
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