Market Mantra: 14/06/2017 (08:30)
SGX-NF: 9610 (-3 points)
For the Day:
Key support for NF: 9595/9570-9530
Key resistance for NF: 9675-9715
Key support for BNF: 23400/23350-23200
Key resistance for BNF: 23650-23750
As par early SGX indication, Nifty Fut (June) may open around 9610, almost flat but well off the morning highs of 9641 mapped in SGX-NF. Overnight US market, DJ-30 closed in positive (+0.44%) at another record high following better than expected core PPI and some bounce back in tech shares. Also, US AG Session’s senate testimony was positive for the market as he declined to say anything about his or Trump’s alleged link with Russia citing “executive privilege”. But, still we may see more such US political jitters regarding Trump-Russia election link as US senate may be very serious to investigate the actual truth behind it.
Globally, today all focus will be on the deluge of US economic data and Fed, which is poised to hike 0.25%, if it springs no nasty surprise. But more than rate cut, market may emphasize more on Fed’s statement, its future guidance/dot-plots, economic projection etc for another hike in Dec’17 or not as Sep is now being virtually ruled out. So, it may be a dovish hike today by Fed, but Yellen may indicate gradual B/S tapering from Sep/Dec’17 onwards in lieu of further rate hike in 2017 amid soft US economic data & poor visibility of “Trumponomics”. A taper tantrum by Fed may not be good for the risk assets as it will be the indication of real normalization (Fed still reinvests maturity proceeds from the QE bonds in the USTSY & MSBS and selling of those QE bonds may hamper market liquidity seriously)
In the morning today, China flashed an upbeat IIP data, but China market is now trading in negative as better Chinese economic data may not be good for stimulus hungry market; PBOC may continue to keep its present neutral monetary policy except some targeted MLF.
Back to home, Indian market may react to the high probable GST disruptions as the nation may not be yet fully prepared for a GST roll out in its present complex form. Also, invocation of IBC act by the RBI/Banks may be negative for the banks in the short term, as they have to take large hair cuts for some unviable projects.
Hints for actionable trading ideas:
Time & Price action suggests that, Nifty Fut (May) has to sustain over 9675 area for further rally towards 9715-9770 & 9825-9865 in the short term (under bullish case scenario).
On flip side, sustaining below 9655 area, NF may fall towards 9595/9570-9530 & 9490-9415 area in the short term (under bear case scenario).
Similarly, BNF has to sustain over 23650 area for further rally towards 23750-23875 & 24000-24100 area in the near term (under bullish case scenario).
On the flip side, sustaining below 23600 area, BNF may fall towards 23400-23350 & 23200-23050 area in the near term (under bear case scenario).