Nifty May Open In Upbeat Mode Following Mixed Global Cues & Better Prospect Of Monsoon; But Ongoing Mixed Q4 Report Card, Higher USD & Oil, US Political Risks And Iron Ore Slump In China May Also Limit Any Blockbuster Rally

9475-9510 Zone In NF May Be A Big Hurdle As Almost All The Good News Has Priced In

HEROMOTORS: (CMP): 3324; Mixed/below expected set of Q4 numbers; 

AT A GLANCE, TECHNICALLY, SUSTAIN BELOW 3305-3240, MAY FALL TO 3180-3145 & 3030-2950 in the immediate to short term

FOR ANY STRENGTH, HM NEED TO SUSTAIN OVER 3350 ZONE FOR TGT OF 3405

Market Mantra: 11/05/2017 (08:30)

SGX-NF: 9445 (+26 points)

For the Day:

Key support for NF: 9425/9390-9340

Key resistance for NF: 9475-9550            

Key support for BNF: 22825-22675

Key resistance for BNF: 22950-23075

As par early SGX indication, Nifty Fut-I may open around 9445, slightly gap up following mixed global cues and better prospect of monsoon this year as predicted by IMD (although SKYMET is cautiously optimistic, predicting just normal rainfall of 96% of LTA against IMD’s 100-106% LTA).

Overnight, US market also closed almost flat, but off the lows following rebound in oil due to surprised US inventory drawdown. Also weak US TSY auction (better yield) and some hawkish comments from an influential Fed member calling for 3 more hikes may have influenced the USD/US bond yields & risk trade. Yesterday’s US export & import index was also looks upbeat/better than expected and together with that some dovish stance of Draghi may have also made the USD stronger.

Despite serious political concerns over Trump’s alleged Russian link, market is relatively calm may be because even if Trump will be impeached in future, RNC members are full in control of the US House (senate/congress) and thus, there may not be any serious political deadlock, even if Trump is impeached. In any way, growing US political risks may be serious headwinds for Trumponomics as Trump will be busy with such political & administrative mess rather than US economic/structural reform.

Back to home, Indian market may be upbeat for better monsoon prediction, but considering the overall mixed global cues & Q4 earnings so far, the rally may be limited from here around 9500 Nifty as almost all the “good news” may have been priced in; market may wait for actual rain fall, its distribution & timing and further cues on the Q4 report cards.

Hints for actionable trading ideas for NF & BNF:

Time & Price action suggests that, Nifty Fut (May) has to sustain over 9475 area for further rally towards 9510-9550 & 9600-9680 in the short term (under bullish case scenario).

On flip side, sustaining below 9450 area, NF may fall towards 9390-9340 & 9295-9245 area in the short term (under bear case scenario).

Similarly, BNF has to sustain over 22950 area for further rally towards 23075-23200 & 23405-23475 area in the near term (under bullish case scenario).

On the flip side, sustaining below 22900 area, BNF may fall towards 22825-22675 & 22500-22400 area in the near term (under bear case scenario).

SGX-NF