Nifty May Open 70 Points Gap Down Around 9080 Following Tepid Global Cues As Reflation Trade Gets A Jolt Amid Political & Administrative Chaos In Trump Administration & Concerns About Trajectory Of Trumponomics

Market Mantra: 22/03/2017 (08:30)

SGX-NF: 9080 (-75 points)

Vital support for NF: 9060-9025/8995

Vital resistance for NF: 9125-9165/9195

Vital support for BNF: 21000-20900

Vital resistance for BNF: 21400-21500

Although global sentiment is down today, fall in USD & Oil may support Indian market sentiment to some extent.

As par early SGX indication, Nifty Fut (March) may open around 9080, gap down by 0.75% following overnight slump in US market (-1.15%) as reflation or rather Trumpflation trade got a jolt amid squabbling about Trumponomics and fate of Obamacare replacement and an apparent chaos in Trump’s administration. As a result, USD was in free fall & USD bond yields were also down significantly and subsequently financials/banking shares got a jolt (lower bond yields may translate into lower NIM). Pharma shares were also down due to confusion about Obamacare replacement with another affordable medical care act.

China is also tightening its home loan market; but provided some liquidity support in its interbank market to avoid default. Japan is also down more than 2% as JPY is getting stronger against USD and there was also an unconfirmed news about another launch of NK missile just a little while ago.

Amid all these global jitters, Indian market may find some support after gap down opening in the form of weaker USD & Oil, which may be beneficial for Indian macro economy; but concern of stretched valuation and bank’s huge NPA, farm loan waiver, tepid loan growth may also limit any significant bounce back. Kotak & Axis Bank may be in focus today amid increasing buss of an imminent M&A after Kotak CEO has expressed his “animal spirits” yesterday at a conclave.

Hints for actionable trading idea:

Time & Price action suggests that, Nifty Fut (March) has to sustain over 9165 area for further rally towards 9195-9235 & 9275-9350 for the day/ in the short term (under bullish case scenario).

On the other side, sustaining below 9145-9125 zone, NF may fall towards 9060-9025 & 8995-8950 area for the day/ in the short term (under bear case scenario).

Similarly, BNF has to sustain over 21400 area for further rally towards 21500-21675 & 21855-21950 area for tomorrow/ in the near term (under bullish case scenario).

On the other side, sustaining below 21350-21250 area, BNF may fall towards 21000-20900 & 20800-20600 zone for tomorrow/ in the near term (under bear case scenario).

 SGX-NF