Monday, September 19, 2016

Nifty: Down but not out

Thought for the day
We give advice, but we cannot give the wisdom to profit by it.
—Francois de La Rochefoucauld (French, 1613-1680)
Word for the day
Overweening (adj)
Exaggerated, Excessive
Malice towards none
The latest Arunachal development reflect best on who:
(a) Supreme Court
(b) Congress
(c) BJP
(d) None of the above
(e) All of the above
 
First random thought this morning
UP Chief Minister has reportedly offered his sulking Uncle whatever ministries, departments and power he likes. This demonstrate that the most populace state in the country has been reduced to a feudal fiefdom of a family, in a total mockery of democratic process and subversion of constitutional proprietary. Surprising the civil society, especially those who shout their throats hoarse on prime time TV shows every evening, are totally apathetic!

Nifty: Down but not out

Despite a sharp gap down opening on Monday, most benchmark indices held well and recovered almost half their losses. Nifty closed the last week with a wow loss of close to 1%. The initial surge in VIX also moderated materially in later part of the week.
The level of institutional activity was poor and volumes were below average. Market breadth does not indicate any panic or moderation in greed of the investors.
Technically, on weekly charts, NIFTY ended the week on the lower edge of the rising and contracting channel that started from end of February 2016. The channel continues to narrow further. However, any breakout (or break down) still appears some time away.
On weekly closing basis, now 8710 appears to be a strong support, however on daily basis 8606-8630 is a strong support zone. A close above 8867 this week shall neutralize the effect of last week's correction and the uptrend shall resume.
Bank Nifty appears to be losing momentum. Watch closely for a weekly close outside 19560-20340 range to decide the next course of action. Near term banks are avoidable for trading.
 

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