Watch
8275-8375 & 8230-8130 Zone In Nifty Fut (Dec), Which May Open Around 8260
Market Mantra: 01/12/2016
(08:30)
As
par early SGX indication Nifty Fut (Dec) may open around 8260 (+6 points),
almost flat following tepid global cues after OPEC led overnight oil rally of
around 10%. Japan (Nikkei) trading strong in Asian session following more depreciation
in Yen.
After
eight years, OPEC yesterday penned some deal to cut production by 1.2 mpd daily
by Jan’17 against some market expectation of 1.4 mpd. As the market was
extremely short on the assumption of no deal, this news, which also came early yesterday,
caused massive short covering and subsequently oil rallied by almost 10% in a
day. Going forward, market will keenly watch the actual implementation of this
deal as in the past there were several incidences of mistrust among various
OPEC nations.
Also,
oil above $50, may induce more supplies from US and together with Trump’s
rhetoric about “Oil independence” of America, we may see more US oil production
and less import for the US. Thus, it may not so easy for the oil to have an
optimum demand supply dynamics (rebalancing) even if one can take the present
OPEC deal on its face value.
On
the other side, higher oil above $50-60 on a consistent basis can also put pressure
on the oil importing economy such as US, China & also India.
In any way, technically
Crude Oil (LTP: 49.53), now has to sustain above 50-53 area for further rally
towards 62.50-70.50; else it may fall again towards 47-44.50 & 42 in an
classic example of “buy the news & sell the fact”.
Although,
theoretically, Oil & USD should have inverse co-relation, yesterday USD strengthen
on the contrary as a result of above estimate US economic data and upbeat Fed
Beige book. All eyes will be on the US NFP job data tomorrow to have an idea
about US economic strength to withstand 2-3 rate hikes in 2017 after Dec’16.
The blockbuster ADP job data yesterday & the Chicago PMI index has helped
the USD significantly yesterday, despite rally in Oil.
Back
to home, Indian market today keenly watch Nov Markit Mfg PMI (estimate: 52;
prior: 54.4) and monthly auto sales data to have an idea about extent of real
damage to the consumption of Indian economy as a result of demonetization led
disruptions.
Market will also watch the ongoing
political battle in the Parliament and the expected banking chaos on the pay
week for its next trigger.
Technically,
NF has to sustain above 8275-8295* area for 8335*-8375/95 & 8425*-8445 zone
for the day (under bullish case scenario).
On
the other side, sustaining below 8250-8230* area, NF may further fall towards
8180-8130* & 8060-8000* zone for the day (under bear case scenario).
Similarly,
BNF (LTP: 18682) need to sustain above 18750* area for further rebound towards
18975-19075* & 19200-19300* zone for the day (under bullish case scenario).
On
the flip side, sustaining below 18600* area, BNF may further fall towards
18500-18330* & 18200*-18100 zone for the day (under bear case scenario).
SGX-NF
BNF
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