Nifty May Open Almost Flat Amid Mixed Global Cues Ahead Of FOMC Minutes; Weak USD May Help Domestic Market As March’17 Fed Hike May Be Almost Off Despite Hawkish Narratives By Various Fed Members

Market Mantra: 22/02/2017 (08:30)

Watch 8925-8850 & 8945-8995 Zone In Nifty Fut (Jan), Which May Open Around 8920 Today

As par early SGX indication, Nifty Fut (Feb) may open around 8920 (+12 points) following upbeat US market; but mixed Asian cues. Overnight US market closed in another record high supported by better than expected earnings from some of the pivotals and mixed economic data. In the morning, Japan is trading slightly lower as Yen got some strength ahead of FOMC minutes. Despite all the Fed hawkish scripts, FFR for March’17 is still at round 20% implying absolutely no probability of a March rate hike by Fed. Depending upon the actual trajectory of “Trumponomics”, Fed may take some action in June’17; otherwise it may be another usual Dec rate hike of 0.25% in 2017 too !!

Back to home, thanks to recent wave of M&A activity, FII limit of HDFC Bank & TCS buyback, Nifty is hovering again at multi month high and eyeing the 9000 level. But, we may see some consolidation/correction shortly as there will be various risk events coming to the market; immediately tomorrow’s BMC poll result, which have an unusual high turnout may be the 1^st major indication about NAMO’s popularity/approval rate after demonetization, despite such corporation/municipal election may have little correlation with the bigger issues. Any good show by BJP this time may help the market for rally towards the record high and vice-versa (for small correction ahead of state election outcome).

Hints for actionable trading ideas:

Technically, NF has to sustain over 8945 area for further rally towards 8995-9035 & 9075-9125 zone in the short term (under bullish case scenario).

On the other side, sustaining below 8925 zone, NF may fall towards 8850-8790 & 8725-8645 area in the near term (under bear case scenario).

Similarly, BNF (LTP: 20855) has to sustain over 20950 area for further rally towards 21050-21200 & 21350-21450 area in the near term (under bullish case scenario).

On the other side, sustaining below 20900 zone, BNF may fall towards 20750-20650 & 20500-20400 area in the near term (under bear case scenario).

 NF