Profit Taking Continues into Earnings Season

Market lost a marginal 0.10% today as profit taking continues in this great earnings season, as the NSE ASI closed 27,486.62 points.

Early market indices showed signs of a BULLISH reversal till Financial score cards of SKYEBANK PLC hit the market with a dividend of 5kobo and NAHCO45kobo dragging the Index back to a negative zone.

Now, lets go back to basics and remember that the market is a discounting mechanism, not a feedback mechanism. As such, all future expectations would have been priced into the market before it actually happens and then if it does, profit taking sets in, resulting in a largely sideways market. If results come in worse than expected, the market will take back those gains that were priced in previously, resulting in a drop.
One bad thing we saw today is that decliners are now above advancers, giving a shade of weakness to this short term market. Since earnings releases so far are largely better than expected, we could see this market go sideways a bit more before bouncing off its 61.80% Fibonacci level.

Technically from a Daily Time Frame, Indices are showing NSE is in a LOWER HIGH RANGE.

Use the TRW Stocks Watch List for Multiple Time Frame to determine which level suites you.

MARKET RESULTS 22ND APRIL2010

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