Stock Market Review

Stock Market Review

STOCK MARKET REVIEW

by Pradeep Chandrasekaran

(the author is the Founder and CEO of Finmark Trainers and can be reached at pc@finmark.co.in)


 

Review: August-2015

THE NIFTY

The NIFTY moved along expected lines with the bulls capitalizing on the Triple Bottom set-up which was highlighted last month.  All the trends in the NIFTY have once again turned bullish and investors should avoid taking short positions.  On the upside, the NIFTY now has resistance around the 8650 mark while on the down side, there is good support around the 8400 level.  The NIFTY’s long term bullish trend will change only if the Index were to break below the 8400 mark.

2a

THE BANK NIFTY

The BANK NIFTY made significant gains during the month.  Significantly, it has managed a close above the downward sloping trendline from the January top.  If the Index can hold above this in the coming days, we could look to a breaking of the January high.  On the downside, the Index has support around the 18300 mark and the bulls will lose their grip only if the Index were to close below this level. Short positions in the segment should be avoided at this stage.

2ab

The CNX IT INDEX

The  CNX IT Index tested the support at the 10860 level (which managed to hold) and trended sideways during the month.  All the trends in the sector are now sideways with the bulls holding a slight upper hand.  Investors can continue to use this phase to build long positions with a stop around the 10800 mark for the Index.

2b

 


Review: July-2015

THE NIFTY

The NIFTY failed to break the resistance at the 8400 mark and again witnessed a sell-off.  The sell-off resulted in the support at the 8000 level once again getting tested.  With the support holding so far, a good foundation has been laid and there is high probability of a Bullish Triple Bottom getting confirmed.  Triple Bottoms are much stronger than Double Bottoms.  Investors should continue to capitalize on the current buying opportunities.  The long-term trend will turn bullish should the NIFTY close above the 8400 mark.  On the other hand, the market will again slip into the hands of the bears should the NIFTY break below the 8000 mark.

 

SMR-07/15.1

SMR-07/15.1

THE BANK NIFTY

The BANK NIFTY followed the general market trend and came under selling pressure.  However, the support at the 17200 once again came to the rescue of the Index.  The Index now has the potential to create a Double Bottom at the 17200 mark.  This will get confirmed should the Index decisively break about the 18100 level.  Investors should remain alert to the opportunities to initiate long positions in the sector.

smr7/15.2

smr7/15.2

The CNX IT INDEX

The  CNX IT Index too met with selling during the month before once again finding support at the 10900 mark.   The CNXIT Index too has the potential now to create a bullish Double Bottom.  The long term bearish trend will be reversed should the Index break the resistance at the 11600 mark.  Should this level be broken, investors can look to build on long positions.

 

SMR07/15.3

SMR07/15.3

 

 



 

 

 

THE NIFTY
The Nifty broke through the resistance at the 7563
level and hit a new high at the 7700 level before settling
down for a much-needed consolidation. While the
long term and the medium term trends continue to be
up, the short term trend is now sideways. The major
support for the Nifty continues to be at the 7100 level
and it is unlikely that this level will be broken in the
near-term.
The market breadth and depth continue to be good
and augurs well for the continuation of the longer term
uptrend.
Investors and Traders who missed gaining an entry
into the market in the previous rally should use the
present consolidation phase in the market for gaining
an entry. Traders should look to initiate positions on
the long side and should avoid short positions at this
stage.
THE BANK NIFTY
The Bank Nifty slipped into a consolidation mode
in the period under review. The Index is now trading a
narrow range between the 14800 and the 15600 levels.
While the long and medium term trends are up, the
short term trend is now sideways. There is no visible
threat to the on-going upmove at present and traders
should use the current consolidation in the sector for
initiating long positions. The Index has strong support
at the 14400 level and long term trend will come under
threat only if this support is broken.
The CNX IT INDEX
The IT sector proved to be the surprise pack of the
week with the Index recording a smart recovery during
the month. The recovery has enabled the Index to close
above the crucial 9200 and thereby neutralize the long
term bearish trend. All the trends in the sector are
now sideways.
Traders should continue to avoid initiating long
positions in the sector unless a clear, sustainable bullish
trend is established.

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