Alarming start to 2014....

Hi all,

After rallying by almost 1% in the first half of trading day today Nifty fell sharply by more than 2% in last 11/2 hours....

There are many forwards for the reasoning behind these falls like, likely resignation of PM, Congress getting support from Left parties in LS 2014, US treasury rates,etc

However the fall of today requires a close attention by the traders as well as medium to long term investors...

After hitting a life high of 6415 on the opening trades of 9th December, Nifty was trying to touch that level in order to sustain, but failed to do that for around 3 times....

On daily charts is a huge bearish candle which is formed after today's fall and on weekly charts will may confirm a Bearish reversal pattern if it closes below 6260 odd levels.

If the bearishness persists key level to watch out for would be 6130-6100 where as long term story may depend on a range starting from 5950-5700 levels....

6350-6415 are the key hurdles on the upside for markets.... As mentioned in earlier posts, a sustained movement above these levels and a firm close above 6360 levels, preferably on a monthly basis can trigger a new bull run in markets....

In my view if markets are going for any corrections in coming months it will be the act of discounting the uncertainty over the elections, and post the same markets may decide the future course of action, which I personally believe is on the upside with a Final reversal of 5100-5000 levels, which looks like not likely to be broken.

All said and done, levels will be as follows...

Short term - (Few weeks)


Trend - Sideways

Supports  - 6200-6170-6140-6120....
Resistances - 6260-6300-6340-6390-6415...

Medium Term - (Couple of months)

Trend - Up

Supports - 6120-5950....
Resistances - 6300-6360-6415-6500

All the levels are on closing basis....

Cheers

Hrishi

Bye Bye 2013....... Cues for 2014!!!

Hi All,

In 2013, Nifty traded with a wide range of more than 1200 points close to 20% (5118-6405)

What do we expect in 2014.....

1. LS Polls 2014 - A big game changer is undoubtedly going to be the Lok Sabha elections in April-May. A clear or a decent majority is surely going to be cheered by markets. The mood was completely in the favour of BJP due to the overwhelming popularity of Narendra Modi but one has to agree that the same has reduced a bit after the stunning debut of the AAP, thanks to Arvind Kejriwal. However, though AAP can make an impact even at the National Level the same may not be of the same as Delhi. I believe AAP can capture seats somewhere in between 20-50 as their National Debut, however more will depend upon how are they performing in Delhi as the entire media seems to be only working as a watchdog for their pre-poll promises.

2. Macro and Micro Economic Growth - The US Bond Tapering (QE) is likely to resume in the 1QCY2013 and the same is been discounted and also seems to be good to neutral for India as per many analysts... At the Micro level, on the eve of 2013, Indian economy continues to feel the heat of Inflation and low growth. As per the statement given by Mr. Raghuram Rajan, a clear majority at the centre will fuel policy reforms which he feels is a key to growth momentum.

3. Corporate Sector - Even the corporates would be keen on the LS polls and the general expectation built up can be seen with BJP due to a strong Anti-Congress wave.

4. Foreign Investments - Many of the big houses has clarified, atleast 3 to 4 to my knowledge that they are waiting for LS polls and are willing to bring in a lot more Vitamin M in India if BJP forms the government.

Technical Observation - 

Amid all the negatives, markets manage to surpass their all time highs which many people termed as a weak rally in spite of prevailing negativity... however I personally feel that if markets manage to give a monthly or at least a weekly close above the all time highs of 6350-6400 one can see a nice bull run over the next 4-10 years... and the triggers for the same will be the ones mentioned above....

So let's wait and watch.....

Wishing you all a Very Happy and Prosperous New Year 2014.....

Cheers

Hrishi