DAILY TECHNICAL VIEW

 

Nifty:- Consumer at the other end!

Nifty, Consumer Price inflation remains the focus of the week. Is it the high number above consensus or the high number that is the worry. Markets are peculiar the way in which they respond to the data. With the multiple rate hikes and supposed to be a fall in commodity prices and oil, easing of supply chain the expectation can be larger fall. Hence, the reaction can be measured only post data. It is not for no reason markets are slightly range bound and moves have been all over. The price action moves to the other side of the pendulum (see the chart) and hence, clearly we are approaching or have approached the profit taking area. Bulls remain strong on 17300 above while bears need close below 16900 to show their presence. Near term 17540-17588-17630 are supply, 17450-17380-330 are the demand zones. Profit taking is very much be the order of the day or the week going forward. With more or less the results season clear, there wont be results led moves. It is purely the incoming growth or inflation led moved. Taiwan is too premature a trade based information as of now. Play the ranges.

NIFTY BANK:-  Outside Comfort Zone! 

Bull, move past 38000 enter a zone of discomfort (for the bears). Central Bank on their part continue to watch inflation past 6% that is the mandated cap. A failure to control for three consecutive quarters invites to articulate the methods and tools to bring this down. This week is full of inflation data. This morning Chinese inflation prints above forecast, later in the day we have German and Italian, while US is much awaited one. Tomorrow we have our own inflation data to print. With not much of a benefit to the economy from the falling crude oil prices, the hope is from the commodity prices fall. Indian 10 Y moved sharply and watch this space in case we print above 7.50%. Rupee too closed near the lows. It is most important as we have entered a time where the moves can be independent of Dollar moves else where as well as yield moves elsewhere. Bulls continue to pierce the resistance and each successive ones have now become supports. 37500 is the new support while 38500 the supply zone. Play that range before market absorbs the inflation numbers.

@sribhashyam65 – Trading View – sreebhashyam  www.quantumtrends.co.in

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