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Markets Slip Further...

Monday, March 23, 2015

NSE India : CNX Nifty — Daily Market Report for: Monday (March 23, 2015) By Dominic Rebello

Review of the Previous day:
The Nifty fell substantially on Friday (March 20, 2015) a net 63.75 points (0.74%) and closed at the 8570 point level. The market opened down with a gap at the 8627 points level and that level itself was the high of the session. The index then declined and turned into a range bound movement until 2.55 p.m. It then declined sharply into the red and registered the day’s low at the 8553 points level at 3.17 p.m. and then turned into a range bound movement until closing at the day. The Nifty remained below its previous close throughout the session, moved in a range of 75 points and closed below the psychologically important 8600 points level. Sentiment was bearish and amongst the 50 Nifty stocks 32 were losers, while 18 stocks closed in the green. Substantial selling was witnessed in realty, power and FMCG stocks.

Technical Analysis:
Volume (Qty shares) increased 13.26%. This change is substantial and indicates a wide participation by investors.

Market Breadth: Overall Market Breadth on the NSE was negative. Amongst all the traded stocks, 277 were gainers, 1187 were losers and 33 remained unchanged.

Slow Stochastic Indicator: The Slow Stochastic Oscillator has declined in the over-sold zone.
The Slow K line in the Stochastic Oscillator is below the slow D line (negative if it continues).

RSI Indicator: The RSI is above the 40 level but is now declining (negative if it continues).

MACD Indicator: The MACD is below zero and is declining (negative if it continues). It is below its 9-day Average (negative).

ADX Indicator & DI Lines: The +DI line is below the –DI line and both lines are diverging (negative if it continues).
The ADX is flat while the Market Index is falling. No signal here.

Moving Averages (Trend Indicators)
The index:
Is below its 5-day average (at 8649) Negative.
Is below its 15-day average (at 8770) Negative.
Is below its 25-day average (at 8783) Negative.
Is above its 200-day average (at 8141) Positive.

Overall Market Strength/Weakness: The indicators and oscillators discussed here are indicating a weak market with a negative bias.

Support Levels: For short-term traders the immediate main support at the 8608 points level was crossed below in the previous session.
The next support is at the 8509 points level.

Resistance Levels: The immediate main resistance is at the 8989 points level.

Pivot Point Analysis: For intra-day traders the support and resistance levels are calculated according to the pivot point theory and are:
Pivot point = 8584 (This is the level where the trend is likely to change during intra-day).
Support (1) = 8540.         Support (2) = 8509.
Resistance (1) = 8615.    Resistance (2) = 8659.

Outlook for Today:
On Japanese candlestick patterns the index has formed a third consecutive black body candle. The body of this candle is below and outside the body of the previous black body candle. This is negative.

Further, the index is below its 5, 15 and 25 day moving averages and all the three averages are declining and also negatively trended. Moreover, the 15 day moving average has dropped below the 25 day moving average.  The velocity parameters continue to indicate weakness. All these indicate a negative bias and the possibility of a further decline unfolding. Investors are advised to avoid buying at present levels.

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