Week Ending 29th December 2023

Dear patrons, by the time this blog reaches you the year would almost be over. What an year for the markets this has been! Stellar performance by all indices over the last few months was witnessed. Almost all indices posted new lifetime highs. Benchmark Nifty has been on a roll, adding to wealth of investors every passing day.

Indian economy is also outperforming global peers by some distance. India's CAD (Current Account Deficit) has also narrowed to $ 8.3 bn from $ 9.2 bn Q on Q for July-September quarter. Decline in CAD was on account of lower merchandise trade deficit and higher services exports. Flow of good news on economy front has been incessant and so has been the rise of the Indian capital markets. We expect this trend to continue and gather more momentum every passing quarter with rising industrial output, once manufacturing also starts to contribute sizably to the economy. Good time is ahead for investors.

Globally not much action was witnessed as the Holiday fever took over. The US indices remained range bound with a positive bias.

In the last blog we had predicted that markets will remain volatile with a positive bias with the December expiry in sight. You may read about it here Weekly Market Update: Week Ending 22nd December 2023 (amitbajare.blogspot.com). As mentioned in the previous blog Nifty did end the year on a high and posted highest weekly closing. Once Nifty broke the barrier of 21600 the move towards 21800 was swift.

Let's see what charts have in store for us in the new year.

For the first time in the week Nifty did not make a higher high on Friday. Nifty looks fatigued on charts and RSI also suggests so. We may witness some fall in Nifty over next few sessions. 21500 should act as first support if indeed some correction sets in. If Nifty closes below 21500 further down move cannot be ruled out with strong support around 21000.

BankNifty is also showing some tiredness. RSI is also showing divergence as in case of Nifty. However, it should find first support near 48000 not far from current closing. Close below 47900 may open further downside for BankNifty with strong support around 47100-47000 range.

Time for traders to become cautious and follow strict stop losses. Booking profits whether big or miniscule and remaining cash ready looks to be the most prudent strategy for traders to make the most of any corrective move on the bourses.

Long term investors may get their portfolio's health checked and look to switch from underperforming stocks to outperforming ones and stay invested.

Happy Investing!!!

Wish you a very happy and profitable new year!!!

"I am very opinionated and sometimes a very irritating character but, I have learnt that the quest to learn is a journey, not a destination." ~ Rakesh Jhunjhunwala

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.