Nifty closes below its 20 Days SMA after almost 5 months as negative
global cues, scaling Global
trade war tensions with India- US Stand off
and post budget profit booking dens the Indian equity market for second
consecutive week. This is first close below 20 Day SMA which was being
held for almost more than last 5 months. Nifty was consolidating around
20 day SMA from Q3 to Q4 of FY18.
International cues have been putting a dent to Indian equity
market despite global Index such as SPX hitting historical high and
touching the 3K mark, Indian equity market is in a corrective mode.
Though, on Daily scale, we have seen 100 Days SMA providing some
support around 11500 levels but the breadth has been very muted with key
sectors such as Auto and Metal trading below 200 days SMA on weekly
scale. While only Pvt Banks, Energy continue to move up with only select
stocks in an overall uptrend. RSI has been diverging from last few
weeks while the correction was very much expected. Profit booking
further intensified the downswing.
Fundamentally there are
important data that will be eyes such as WPI Inflation along with Food
and Fuel inflation. While the cues will be taken from global markets
specifically where do we go from here as the Trade tensions rises with
India putting tariffs on US products. This can now be a process of
months that would take to be sorted out and markets may not be taking
any ease as of now.
The range for market is seen around 11450 -
11750 for this week. A breakdown below 11450 on closing basis can call
for a deeper correction to 11200 - 11180 while sustaining the 100 days
mark on daily scale would be a positive sign. Hence traders should be
cautious at this point of time.
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