Monday, 5 June 2017

Nifty May Open In Green Following Another Record Closing Of US Market And GST & RBI Rate Cut (?) Optimism; Muted Global/Asian Cues After London Terrorist Attack May Also Limit Any Significant Upside Today

Market Mantra: 05/06/2017 (08:30)

SGX-NF: 9660 (+15 points)

For the Day:

Key support for NF: 9645/9625-9595/9540

Key resistance for NF: 9700-9750

Key support for BNF: 23300-23200

Key resistance for BNF: 23400-23500

As par early SGX indication, Nifty Fut (June) may open around 9660, at 15 points gap up following positive closing of overnight/Friday US market (+0.29%) despite subdued NFP job data report; US market was helped by industrials & tech shares amid Trump’s ongoing stance of protectionism (America first). His withdrawal from Paris climate accord may be viewing as positive for US Mfg industry and American jobs. Trump now wants to export (sell) US technology for clean CO2 or NG to EM like China & India.

Morning Asian/global cues are mixed following a sad incidence of terrorist attack in London yesterday; but UK poll will go on as scheduled (8th June). China market is trading lower following further strengthening of Yuan by PBOC despite better than expected service PMI; PBOC has vowed for a neutral monetary policy going ahead.

Back to home, Indian market may digest more on multiple GST rates on different products, even on the same sector. Lower GST rates on some of the products may be helpful at a glance for the manufacturers, but at the end of the day due to competition, all such lower rates may also be transmitted to the consumers. All eyes may be on the service PMI and RBI day after tomorrow for any rate cut/dovish stance after terrible GDP data for Q4FY17.   

Hints for actionable trading ideas:

Time & Price action suggests that, Nifty Fut (May) has to sustain over 9700 area for further rally towards 9750-9825 & 9865-9930 in the short term (under bullish case scenario).

On flip side, sustaining below 9680 area, NF may fall towards 9645-9595 & 9540-9495 area in the short term (under bear case scenario).

Similarly, BNF has to sustain over 23400 area for further rally towards 23550-23650 & 23875-24000 area in the near term (under bullish case scenario).

On the flip side, sustaining below 23350 area, BNF may fall towards 23200-23050 & 22950-22750 area in the near term (under bear case scenario).


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