WEEK ENDING 06TH APRIL 2023

Dear patrons, last week was a truncated trading week with holidays galore, however the markets were in buoyant mood and saw sharp rally to end the week gaining over 1%. As was mentioned in the last blog Nifty moved past first resistance 17400 and closed just below 17600. You may read about it here Weekly Market Update: Week Ending 31st March 2023 (amitbajare.blogspot.com)

The RBI announced its monetary policy last week. In a surprising move the RBI maintained a status quo in the rates, even though inflation remained at uncomfortable levels. The central bank also suggested that it remains accommodative in its stance, paving way for the markets to move upwards. The RBI's move is a bold statement highlighting the belief in the economic stability in the country boosted by the domestic consumer. Globally banks are raising rates due to high inflation. In India, however, the central bank is hardly thinking about inflation and focusing on growth. This boldness should yield results in the coming quarters, and we should see rise in economic activity and a move towards $5 Tn GDP in near future.

India's exports crossed $ 750 Bn mark for the first time. The Government also announced new Foreign Trade Policy last week and impetus is given to exports, aiming for $ 2 Tn by 2030. The target set by the trade policy looks achievable especially with increased manufacturing activity along with rise of India as an arms supplier. 

Let us now try and analyze what's in store for the coming week, which again is truncated.

As can be clearly seen Nifty has closed just below a major resistance around 17620. For the next week, the Nifty should face stiff resistance around 17600 and change course of direction. 

On the weekly charts also, Nifty has resistance around the same levels i.e. 17600. The up move in Nifty is likely to be terminated around these levels. A close above 17630 may provide strength to the bulls and open up 17750 on the index.

The Bank Nifty on the other hand has managed to close above all-important resistance of 40800. A break below 40800 may open up move towards 40100 on the Bank Nifty. 41400-41500 remains a profit booking zone for the time being. Bank Nifty is likely to be range bound with a negative bias. 

As always traders should follow levels and adhere to strict risk management rules. Result season is approaching, which may lead to increased volatility and stock specific action. There should be ample opportunity on both sides.

“Conviction is not an happening, but once you go through the process & be convinced, do not compromise it. The rest will also come to your turf eventually.” ~ Sandeep Sahajpal

P.S.: This communication is for educational purpose only and does not recommend buying or selling any stock or index. Trade at your own risk.