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Bullish Fervour Continues

Tuesday, March 03, 2015

NSE India: CNX Nifty — Daily Market Report for: Tuesday (March 3, 2015)  
(Based on the activity of the previous trading day) by Dominic Rebello

Review of the Previous day:
The Nifty rose substantially on Monday (March 02, 2015) a net 54.90 points (0.62%) and closed at the 8956 point level. The market opened up with a gap at the 8953 points level. It then rose further and registered the day’s high at the 8972 points level at 10.20 a.m. The index then declined sharply, into the red and registered the day’s low at the 8885 points level at 12.07 p.m. It then bounced back into the green and turned into a range bound movement until closing at the day. The Nifty witnessed a volatile session and moved in a range of 87 points. Sentiment was bullish and amongst the 50 Nifty stocks 28 were gainers, while 22 stocks closed in the red. Substantial buying was witnessed in capital goods, healthcare and banking stocks, while substantial selling was witnessed in FMCG and consumer durables stocks.

Technical Analysis:
Volume:

Volume (Qty shares) decreased 14.85%. This change is moderate and indicates a moderate participation by investors.

Market Breadth:
Overall Market Breadth on the NSE was positive. Amongst all the traded stocks, 803 were gainers, 641 were losers and 41 remained unchanged.

Slow Stochastic Indicator:
The Slow Stochastic Oscillator has risen and has entered the over-bought zone.
The Slow K line in the Stochastic Oscillator is above the slow D line (positive if it continues).

RSI Indicator:
The RSI is above the 60 level and is now rising (positive if it continues).

MACD Indicator:
The MACD is above zero and is rising (positive if it continues). It has crossed above its 9-day Average (positive and a buy signal).

ADX Indicator & DI Lines:
The +DI line is above the –DI line and both lines are flat. No signal here.
The ADX is flat while the Market Index is rising. No signal here.

Moving Averages (Trend Indicators)
The index:

Is above its 5-day average (at 8830) Positive.
Is above its 15-day average (at 8785) Positive.
Is above its 25-day average (at 8782) Positive.
Is above its 200-day average (at 8040) Positive.
All the four averages are positively trended. Positive.

Overall Market Strength/Weakness:
The indicators and oscillators discussed here are indicating a strong market but with a neutral bias.

Support Levels:
For short-term traders the immediate main support is at the 8608 points level.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 = 8938 (This is the level where the trend is likely to change during intra-day).
Support (1) = 8904; Support (2) = 8851.
Resistance (1) = 8991.
Resistance (2) = 9025.

Outlook for Today:
On Japanese candlestick patterns the index has formed a second consecutive doji pattern. This indicates that the indecisiveness amongst investors continues. The next candle formation will confirm whether the bias is towards the buy or sell side of the market.

However, the index is above its 5, 15, 25 and 200 day moving averages and all the averages are rising. Further, the 15 day moving average has crossed above the 25 day moving average. Moreover, the velocity parameters continue to indicate strength. All these indicate a positive bias and the possibility of a further up move unfolding. Investors are advised to hold long positions.

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