Markets on the back of improved corporate
results and since being over sold after having fallen for past two weeks staged
a throwback rally, and finally manage to end the week on flat note, still
leaving behind uncertainties. Although recovered a bit in the short term due to
rise in few sectors, the under tone is still mildly bearish, rising oil prices,
political uncertainty, inflation, weak rupee are all area of concern and needs
to be resolved soon or else the markets would start bleeding. There are some
tailwinds (positives) too, it needs to be seen if it outweighs the headwinds
(negatives), the tailwinds are the further improvement in corporate profitability
on the back of improved demand, expected policy reforms, credit off-take,
improved export and better realization thereof due to weak rupee. It can be
safely concluded that the markets will be volatile, jittery and lackluster for
some time.
TECHNICAL – The pullback or the throwback rally
managed to end the week on flat note, Nifty is now poised against the key
resistance of 10700 and 10800 and this would be tough for the markets to cross.
On the lower side support exists between 10400 to 10600 levels, hence the broad
range for the Nifty is 10400 to 10800 and the near term range is 10500 to
10700, until some significant news would oscillate between these levels, however
close below 10400 will be very vulnerable position for the markets and deep
correction would be witnessed and the upside remains capped at 11200 even if Nifty
closes above 10800.
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