On the Daily Chart, NIFTY has made a Short Black Candlestick, after making higher highs and higher lows with High Wave Candlestick Pattern in last two trading sessions. A group of high wave candlesticks signal a possible reversal in the market, which was proved by the last day’s candle. Once again a Choppy Session was witnessed. IT Stocks were the Star performers of the day. Most of the stocks started the day strong in Green with NIFTY witnessing a purely flat opening. Interest rate sensitive stocks - banking and realty - fell over 3% on worries that higher interest rates will dent demand for residential and commercial properties, and dragged the indices lower. After the opening of European Markets too, NIFTY dragged much below to the levels of 5942.75. Moody’s Investors Service warned it may downgrade Spain’s credit rating and it also lowered Vietnam's bond rating to B1 from Ba3 and maintained a negative outlook. These news flows sent a shockwave to the European Markets and dragged them in Red. Indian Markets also slipped in the same way. Announcement of better Q3 Advance Tax Numbers by India Inc. also could not provide a cushion to the markets. For the day, NIFTY made a high of 5942.75 and maintained to close at 5892.30 levels.
Net Selling of Rs. 87.61 Crore in Cash Segment and of Rs. 443.97 Crore in F&O Segment by FIIs was witnessed on Wednesday's Trading Session.
In F&O Segment Net Buying was witnessed of Rs. 366.09 Crore in Stock Futures, while, Net Selling was witnessed in Index Futures, Index Options and Stock Options Segment of Rs. 607.97 Crore, Rs. 191.66 Crore and Rs. 10.43 Crore, respectively.
NIFTY DEC FUTURE ended with the premium of 3.70 points to the Spot NIFTY.
Technically, NIFTY bounced back, but with lack of buying interest and very sluggish volumes. It could not close above the levels of 5960 and again slipped by making a high of 5942.75. Now, NIFTY is again expected to touch the levels of 5800 in the short term. The level of 5750 is acting as a strong support which if breaches again on the closing basis; NIFTY may test the levels of 5500. Markets are again expected to trade with full volatility in the next trading session as The Reserve Bank of India’s (RBI) credit policy review is scheduled tomorrow.
On the Economic Front, AUSTRALIA will be coming out with its Consumer Inflation expectation for the month of December. Wholesale Price Index for the month of November, Purchasing Manager Index Services & Manufacturing for the month of December will be announced in GERMANY. EUROPEAN MONETARY UNION will be coming out with its Purchasing Manager Index Services & Manufacturing for the month of December and Consumer Price Index for the month of November. Retail Sales, Building Permits and Housing Starts for the month of November, Q3 Current Account, Initial Jobless Claims, Continuing Jobless Claims and Philadelphia Fed Manufacturing Survey for the month of December will be announced in US.
NIFTY is trading below its 20-Days EMA (Exponential Moving Average) of 5936.19 and the 50-Days SMA (Simple Moving Average) of 6038.75. Both the Moving Averages are indicating a negative crossover, with short term moving average crossing the long term moving average from upside. The first immediate resistance for the NIFTY comes at 5720 on the Closing Basis.
MACD (Moving Average Convergence Divergence) has entered into negative territory now. But at the same time, RSI (Relative Strength Index) reverted from the overbought zone. Brutal selling in BANKING stocks, which maintained the markets to life time high, indicates a very cautious approach to be followed while trading in the markets at this stage. Investors are also suggested to avoid making fresh investments at this stage.
For the day, intraday resistance for NIFTY comes at 5920 / 5945 / 5980 levels. At the same time, 5860 / 5835 / 5790 will act as major intraday support levels.
What does Indicators Say?
- RSI (14 Days & 9 Days): The values are 46.14 and 45.82, respectively, showing a negative crossover.
- MACD (26 Days & 12 Days): Their Values are -37.65 and -39.73, respectively. a negative crossover is indicated by both the Moving Averages.
- +DI: 17.51, -DI: 28.32, ADX: 26.65: The Positive Directional Index has gained strength over the Negative Directional Index and also the Average Directional Index is above 20, indicating the development of strength in the current trend.
- SMA (50 Days) & EMA (20 Days): The values of these two indicators are 6038.75 and 5936.19. Both the Moving Averages are showing Negative Crossover.
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