Our markets opened weak, traded volatile during the day and finally closed with losses at the end of the session following global mood. Crude overnight has cooled 5$ to 119$ intra day to finally closing at 120$. This was prompted by the economic data from US confirms slowing demand for the commodity, evident from Highway miles data. The raise in energy prices which has hurt the industrial economy resulting in job losses, lay offs cannot be recouped immediately with falling crude prices, it is believed by economists. FOMC meeting to night has to take an important decision to raise the rates now or atleast confirm that reducing the rates is done with for now, and might indicate the starting of raising some time down the line, will influence the dollar's parity with Euro and other currencies. This will decide the commodity prices and the out look for global economy and trends. For the present entire global markets including ours are in deep bearish trend, and resumption of bullish ness cannot happen in near future, at least during this month. The current stock prices of index stocks are good values to exit on rallies, as the same can be picked up later at much lesser prices. The current relief rally in our markets can maximum go upto 100DSMA currently placed at Nifty(4623.67) & Sensex(15439.19) during this month, in my opinion.
VIX closed at 40.24 yesterday. US markets closed mixed after volatile moves over night and asian markets are trading in negative territory currently. Singapore Nifty futures are currently quoting at a discont of 21 points, indicates weak opening initially. Nifty might find support at 4320 levels where confluence of 5DSMA and 50DSMA is placed currently. Breaking July closing level of 4332.95 will invite short build up and triggering of stop losses which can force Nifty to 4185 level too. We may be into some small range sideways movement days/weeks before clear direction emerges, which requires an event or data, as the results season for Q-1 is almost done with.
Range for the Day: Nifty might trade in the range of 4320 to 4420 today.
3 comments:
Sir,
i used read your postings, i have seen that you have closed your 1st and 4th position, means that the maket will not not move upside?
Thanks
Laxman
Dear Rao,
I am a regular reader of your blog. Today I was surprised about the move upside? DO you feel it persists?
Moreover what do you feel the bootom for this series?
Dear Laxman,
I believe that 4678.40 on nifty is a strong resistance to break during the month. Thus, I preferred to book profit a head of FOMC meet(an event) on the sudden surge of our markets.
bkvrkrao.
Dear Sridhar,
The upside from 01.00p.m. was due to heavy short covering in banking stocks, since traders have gone short in the morning, expecting weakness a head of FOMC meet, since asian markets closed negative.
Even I am surprised by the move and strength till last minute, as I was not expecting the Niftyto move beyond 4420 which I indicated in the posting too.
As per the reading goes for now, Nifty might not break 4000 during this month by expiry. Thus, 3790 low created in July should hold.
More details in the posting on daily basis.
bkvrkrao
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