Review of the Previous day:
The Nifty rose moderately on Tuesday (February 21, 2012) a net 42.85 points (0.77%) and closed at the 5607 point level. The market opened at the 5561 points level and that level itself was the low of the day. It then rose steadily throughout the session and registered the day’s high at the 5621 points level at 2.38 p.m. It then declined marginally and turned into a range bound movement until closing at the day. The index moved in a range of 60 points and closed above the psychologically important 5600 points level for the 1st time since 25th July 2011. Sentiment was bullish and amongst the 50 Nifty stocks, 32 were gainers, while 18 were losers. All the sectoral indices barring IT closed in the green. Heavy buying was witnessed in realty, consumer durables and oil & gas stocks.
Technical Analysis:
Volume:
Volumes indicate a moderate participation by investors.
Market Breadth:
Overall Market Breadth on the NSE was positive. Amongst all the traded stocks, 862 were gainers, 604 were losers and 52 remained unchanged.
Slow Stochastic Indicator:
The Slow Stochastic Oscillator is in the over-bought 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 60 level and is now rising (positive if it continues).
MACD Indicator:
The MACD is above zero and is now rising (positive if it continues). It is above its 9-day Average (positive).
ADX Indicator & DI Lines:
The +DI line is above the –DI line and both lines are diverging (positive if it continues).
The ADX is rising while the Market Index is rising, which indicates that the present up trend is increasing in strength.
Moving Averages (Trend Indicators)
The index:
Is above its 5-day average (at 5528) Positive.
Is above its 15-day average (at 5394) Positive
Is above its 25-day average (at 5256) Positive
Is above its 200-day average (at 5172) Positive.
All the four averages are positively trended. Positive.
Overall Market Strength/Weakness:
The indicators and oscillators discussed here are indicating a strong market with a positive bias.
Support Levels:
For short-term traders the immediate main support is at 5040 marked as S1.
The next support is at 4900 marked as S2.
Resistance Levels
The immediate main resistance at 5605 marked as R1 was crossed above yesterday.
The next resistance is at 5743 marked as R2.
Pivot Point Analysis:
For intra-day traders the support and resistance levels are calculated according to the pivot point theory and are:
Pivot point = 5597 (This is the level where the trend is likely to change during intra-day).
Support (1) = 5572.
Support (2) = 5537.
Resistance (1) = 5632.
Resistance (2) = 5657.