You must
read previous articles and watch the given chart carefully to understand this
article completely.
For 29
January 2014: -
On 28
January 2014, FII Sold INR 1267.35 crs and DII Bought INR 1178.81 crs
FIIs are
known to sell bottom heavily in cash market and they are doing it from past two
days. There is no wonder in this trend. What is wondering me is Dr. Raghuram
Rajan. He is now following the footsteps of former RBI governor D. Subba Roa.
Irony is that when Dr. Raghuram Rajan was prime minister Advisor he was
advocating for rate cut from RBI. Now
when he became RBI governor he is fluctuating with his views.
Another
thing is that if there were less reason for hike in December month policies
(when rates were not hiked) then we have no reason to think for rate hike (we
got hike of 25 bps in repo rate).
He himself
is a better man to judge his action. I can say that RBI is still sitting on
wrong side. Current RBI governor is lucky enough that he is not facing challenges
like the way former governor was facing.
Now, this
kind of story continues in Indian capital market. You can never able to judge
economy policies based on realities.
Technical
charts are still saying that Nifty is weak but it is now over stretched and
hence technical bounce is very likely. First good sign is that Nifty hit a low
at 6085 on dot yesterday and bounced to close at 6126. We are heading towards
derivative expiry and that can make market wilder than expected.
We can expect
this recovery sustaining if Nifty manages to stay above 6165 levels. It is
tough task but not the impossible task. Let us see today’s trade.
Strategy
for Nifty January future – It is going to be
a flat opening. There are signs of recovery but those are based on technical
pullback only. There are two important levels, one is at 6172 and another at
6211. Firstly, it needs to stand above 6172 to claim for some intraday
strength. Secondly, it needs to stay above 6211 to say that recovery can
sustain. I hope for recovery and derivative short covering may add fuel.
Shall I buy low or shall I sell the pullback? Please visit my ‘intraday
updates’.
S&P
500
(USA) – I had already quoted for
this rebound as S&P 500 were near key support of 1769. It has to surpass
1800 marks also. If I keep fed minutes on one side then 1800 marks can come by
today itself. it is very likely to gain more from current levels. Futures are
also confirming my views for this rebound. I feel that today’s rise or fall will
be decisive. One should never under estimate the bulls sitting at USA. Key
support right now will be again at 1769 and resistance on higher side will be
at 1814+ only.
Regards,
Praveen
Kumar
