Market Mantra: 30/08/2017 (09:00)
SGX-NF: 9865 (+73)
For the Day:
Key support for NF: 9845-9790
Key resistance for NF: 9905-9950
Key support for BNF: 24000-23850
Key resistance for BNF: 24375-24575
Hints for positional trading:
Time & Price action
suggests that, NF has to sustain over 9905 area for further rally towards
9950-10030 & 10075-10155 area in the short term (under bullish case
scenario).
On the flip side, sustaining below 9885 area, NF may fall
towards 9845-9790 & 9750-9700 area in the short term (under bear case
scenario).
Similarly, BNF has to sustain over 24375 area for further rally
towards 24475-24575 & 24675- 24775 area in the near term (under bullish
case scenario).
On the flip side, sustaining below 24325 area, BNF may fall
towards 24200-24000 & 23850-23700 area in the near term (under bear case
scenario).
As par early SGX
indication, Nifty Fut (Aug) may open around 9865, 73 points gap up, erasing almost
all the yesterday’s loss as Trump threatens no “fire & fury” to Kim and the
Nuke Armageddon between US & NK cools off. Also Kim’s rhetoric towards
Trump is much more measured and thus USDJPY shrugs off an imminent “war of
nukes” between US & NK and covered its short from the vital support zone of
108 triggering a corresponding risk appetite in the US & global market in
NY trading session yesterday.
Market may be also optimistic
about US tax reform as Trump is scheduled to start his campaign to convince the
US public about the benefits of his tax plan intended for the middle class and ongoing
obstruction by some of his own RNC members coupled with the opposition DNC.
Thus, Trump may be trying
to “kill two birds with one stone” by a political campaign on US tax reform; if
it’s passed by the US congress, then he will take credit for it; otherwise he
will pass all the blames to his political oppositions, “obstructing US
development”.
Market may be also slowly
being convinced about Trump’s growing political maturity; if he has the support
of US public, then everything may be easy for his “Trumponomics” narratives. But,
still then, a significant risk is there for Trump in his Russian links
investigation.
Thus, market may be
hopeful for passage of US tax reform bill by Dec’2017 as promised by Cohn few
days ago, overcoming the present environment of US policy paralysis at WH. But,
ongoing rehabilitation focus at Harvey affected area may also undermine Trump’s
political effort (tax reform) at this point of time.
Overnight US market also
closed higher, reversing all the pre-open fall; DJ-30 closed 0.26% higher,
while S&P-500 was up by 0.08% and NASDAQ was in 0.30% green, helped by FANG
(Tech) & defence stocks.
US stock future (SPX-500)
is now trading around 2448, almost flat (+0.05%) and looking ahead, it has to
sustain above 2455-2465 zone for further strength; otherwise it may again come
down. Market may focus on EUR strength, while it’s consolidating around 1.20 in
EURUSD coupled with US GDP & payroll data in the coming days apart from
ongoing US-NK geo-political tensions and Trump’s political woes.
It now seems that Fed
should not be concerned about any unusual USD strength, while it will gradually
normalize its BS, because US political risk & NK’s missile games may be
some of the perfect weapons to keep USD depressed despite a hawkish Fed, the
only major G-10 central bank, thinking about dual QT.
Back to home, Indian
market may also focus on the elusive earnings recovery & stretched
valuations, fresh list by the RBI for NCLT/IBC corporate big NPA and its actual
resolution; ultimately both Govt & Banks also want a meaningful resolution
rather than liquidation.
Apart from corporate NPA,
retail NPA for the banks may be now growing abnormally, especially after DeMo
& GST blues, where small business/SMES are finding it more difficult to
sustain by paying full compliance costs of his business. Also, home loans and
other personal secured & unsecured loans are becoming stressed on the back
of growing insecurity about jobs & uncertainty in
self-employment/professionals.
NF
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