Afternoon Newspaper : Daily Market Report for Friday (November 20, 2009)
Stratstar
Market in correction mode…
By Dominic Rebello
Review of the Previous day: The Nifty fell substantially on Thursday
(November 19, 2009) a net 65.70 points (1.30%) and closed at 4989
point
level. The market opened down and continued so until 02:51 p.m. when
it
reached its day low at 4963 points. Then it rose and turned into a
range
bound movement until closing at the day. The market moved in a range
of 90
points. Sentiment was bearish and amongst the 50 Nifty stocks, 44 were
losers, while just 6 were gainers. Selling was witnessed across all
the
sectors. Realty, oil & gas, technology, telecom and metal were amongst
the
worst hit sectors.
Technical Analysis:
Volume: (Qty shares) increased 10.83%. This change is moderate and
indicates a moderate participation by investors.
Market Breadth: Overall Market Breadth on the NSE was negative.
Amongst
all the traded stocks, 386 were gainers, 877 were losers and 50
remained
unchanged.
Slow Stochastic Indicator: The Slow Stochastic Oscillator is in the
over-bought zone.The Slow K line in the Stochastic Oscillator has
dropped
below the slow D line (negative and a sell signal).
RSI Indicator: The RSI is above the 40 level but is now declining
(negative if it continues).
MACD Indicator: The MACD is above zero and has turned flat (positive
if it
rises). It is above its 9-day Average (positive).
ADX Indicator & DI Lines: The +DI line is below the –DI line and both
lines are diverging (negative if it continues). The ADX is falling
while the
Market Index is falling, which indicates that the present down trend
is
decreasing in strength.
Moving Averages (Trend Indicators)
The index:
Has dropped below its 5-day average (at 5032) Negative.
Is above its 15-day average (at 4879) Positive.
Is above its 25-day average (at 4935) Positive.
Is above its 200-day average (at 4070) Positive.
Overall Market Strength/Weakness: The indicators and oscillators
discussed
here are indicating a strong market but with a negative bias.
Support Levels: For short-term traders the immediate main support is
at
4394 marked as S1 (blue line below the Index).
Resistance Levels:The immediate main resistance is at 5193 marked as
R1
(red line above the Index). The next resistance is at 5580 marked as
R2 (red
line above the Index).
Pivot Point Analysis: For intra-day traders the support and resistance
levels are calculated according to the pivot point theory and are:
Pivot point = 5002 (This is the level where the trend is likely to
change
during intra-day).
Support (1) = 4951.
Support (2) = 4912.
Resistance (1) = 5040.
Resistance (2) = 5092.
(For support and resistance levels all F&O stocks refer to the
Afternoon
Newspaper or click here
http://www.stratstar.com/markets/resistance.php?type=Futures)
Outlook for Today: On Japanese candlestick patterns the index after
having
formed two consecutive doji patterns (indicating indecisiveness
amongst
market men) has formed a black body candle on higher volumes. This
indicates
that the bias has shifted towards the sell side of the market.
Further, the
index has dropped below its 5 day’s moving average. Moreover, the
velocity
parameters, which were positively trended, have now turned neutral.
All
these indicate a negative bias.
However, the index is above its 15, 25 and 200 day’s moving averages.
Investors are advised to hold long positions, but with a strict stop
loss at
the 15 day’s moving average at the 4879 points level.
Work with strict stop losses on all positions.
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