Dear patrons, first of all let me apologize for not writing this blog last week due to some unavoidable circumstances. Indian markets managed to regain psychologically important level of 25000 on the Nifty while BankNifty remained subdued ending yet another week below 55000. Markets managed to close positive on all sessions gaining slow momentum.
Reduction in GST, softening POTUS stand along with Indian investors' appetite for stocks provided the much-required push for the markets to inch higher. As we had mentioned in our previous blog, reduction in GST is aimed at increasing domestic consumption. timing of reduction could not have been better, as the festive season begins, it is an attempt to wake up the domestic consumer from his slumber.
Globally, the US markets rallied on expectation of faster and larger rate cuts from the Federal Reserve owing to poor jobs data. All three major indices on the NYSE hit lifetime highs yet again, although the last session saw some profit booking. European counterparts followed cues from the US markets and rallied. Asian markets remained pretty buoyant as well.
Gold and Silver are glittering like never before, conquering newer highs each passing day. Upward momentum in Gold can be attributed to geopolitical maneuvers, as the BRICS wants to end the USD hegemony.
The US is sending feelers through social media for betterment of ties with India. After all the bravado of threats of destroying the FOURTH largest economy, better sense is prevailing in the US, contributing partially to the rally in Indian markets.
Let's now take a look at charts and try to figure out what lies in store for the coming week.
Nifty managed to close above 25100 for the week, gaining more than 1%. We expect Nifty to continue its forward journey with a mild resistance around 25150-25200. Nifty looks set to move towards 25400-25500 for the coming week. Support on the other hand is placed around 24800-24900. Strong support for Nifty lies in the 24500-24600 range.
BankNifty also gained more than 1% over the week without showing much hassle for it. BankNifty has underperformed the broader markets over last few weeks. We believe time is ripe for it to start marching forward. BankNifty closed the week a tad below its 100 EMA. For the coming week support for BankNifty lies in 54500-54600 range. Resistance lies around 55500. Strong resistance may be encountered around 55900-56000.
Coming to midcap index, it looks poised for a considerable up move. Resistance for MIDCAP 100 is placed around 58800, crossing this level should take it to 59800. Support on the other hand is placed around 57600 below which 56900 should act as strong support.
Investors should look to accumulate good quality stocks. There may be short term pain, but eventually the reward will out do the pain. Focusing on select midcap stocks should prove to be more rewarding than large cap stocks. Select sectoral indices are also looking good.
Stay Invested!!!
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.
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