Stock Market Brief by Imtiaz Merchant for 17th December 2018
Markets being oversold staged a throwback rally last week on the back of stable govt for state assembly and no hung parliament in any of the five states turned positive for the markets and bear covering rally did its job and ended the week and the day on positive note. Though it was a minor set back for the present central government but looking at the fact that it is still six months away will give respite to government, the under current for the markets look bullish being held despite global markets showing weakness, hence it appears that 10400 to 10600 offers good support for the markets fundamentally. It further needs to be seen how the corporate results are unfolded which is less than a month away. It further needs to be seen how the global and commodity market behave and that shall have baring on Indian markets.
Investors should be cautiously and stocks specifically optimistic on the markets and are still advised to be a portion in cash for any contingency or eventuality.
Technical- Technically after the throwback rally last week, market once again is in a range bound trade, the near-term range is between 10550 and 10950, a close on either side will determine further trend. In the extreme near term the range is between 10650 and 10950. The intermediate (medium term) trend is although down and shall turn up if the Nifty closes above 11050 and stays there. In event of close above 11050 markets will be poised for new historic high, though that looks a bit difficult now, however a close below 10550 the nifty would initially test 10350 and then perhaps 10000 is likely to get tested.