Nifty Fut(Sep):7540 Zone Is Important And Sustaining Below That It May Find Base Around 7315-7180 For The Time Being; Dovish Fed & RBI Rate Cut/GST Hope May Support

 Trading Levels (Positional):

SGX NF: 7600 (LTP)

NSE NF: 7662 (LTP)

		Gap Up/Dw	(Indicative)
SGX NIFTY	7600	-62
				NF-SEP	LTP			7662
	SL (+/-) 10 POINTS	FROM SLR
	Intraday Swing	Trader
			T1	T2	T3	T4	T5	SLR
Strong >	7530		7565-98	7632-65	7700-20*	7750-71	7800-25	<7510
Weak <	7510		7475-45	7412-390	7350-15*	7290-50	7200-180	>7530
FOR	Conservative	Positional	Trader
			T1	T2	T3	T4	T5	SLR
Strong >	7530		7598	7665	7720*	7771	7825-75	<7510
Weak <	7510		7445	7390	7315*	7250	7180-6985	>7510

Rationale:

US NFP (Job) data was mixed on Friday. Headline number was poor and below estimate but revisions were higher and unemployment rate (5.1%) was slightly below estimate. Consequently, Fed Fund Rate was showing only 30% chance of Sep lift off and market is bracing now for Dec'15. Despite that, US market sold off for its own growth concern, long week end holiday (labour day today) and China opens today after two days holidays there (as traders lighten their long positions for risk off).

All eyes will be on today's China figure of FX reserve data today after the devaluation & intervention of Yuan by PBOC. Market is bracing for a figure of around $100 billion decrease and keenly watched behavior of  mainland China market, which may be included in the MSCI index shortly as par reports.

Stability of Chinese market is now most important for the global market along with Fed's decision regarding rate hike on Sep'17.

Back home, though decision to implement OROP could cost us around 8000-10000 cr over the next five years or so and Govt has to find a mechanism for necessary funding, it may act as a stimulus to our economy as lots on money will come into the system (especially rural India) which may be translated into real spending in the days ahead along with implementation 7-th pay commission (Jan'16 onward).

Also there will be GST & RBI rate cut hope, which may kept the market alive & volatile also.

Technical Analysis & Charts:

As par simple EW analysis, we may be in the C wave now and the text book target may be 7660-7540 or in the worst case scenario even 6500 (extended correction).

As market is extremely oversold, watch 7632-7540 zone for any possible short covering up to 7720-7785 today/this week.