INSUBCONTINENT EXCLUSIVE:
Bearish undertone persisted on Dalal Street, as the NSE benchmark Nifty opened lower on Friday and remained in the falling channel
The index ended 86.30 points or 0.81 per cent lower.
The nervousness was evident, as the political drama in Karnataka shifted to proving the
majority on the Assembly floor
What happened in the southern state over the past 10 days can also be viewed as a prelude to what can be expected from the general elections
in 2019.
Life sprouting out of almost nonexistent Opposition can instil political uncertainty in the country
There are high chances that the Nifty might see a weak opening
However, that being said, it is also likely that post weaker opening, the Nifty might spend rest of the session trying to improve the show
The 100-DMA levels will be very crucial to watch out for as a major support on a closing basis.
The levels of 10,630 and 10,665 will act as
resistance, while supports may come in at 10,165 and 10,540 zones.
The Relative Strength Index (RSI) on the daily chart is 47.3261
It has marked a fresh 14-period low, which is bearish
RSI does not show any divergence against the price
The daily MACD stays bearish while trading below its signal line
No significant formations were seen on the candles.
Overall, Monday is likely to turn out to be a volatile session for the market
We will continue to see selective buying at any given levels in the sectors that are outperforming the general market or in the stocks,
which have posted good results.
In an event of any possible downside, the 100-DMA levels will be crucial to watch out for
Though overall exposures should be kept at modest levels, lower levels can be utilised to make good quality purchases.
With political dust
nearly settled, market may now attempt to find its bottom in the days to come.
STOCKS TO WATCH: Relatively resilient technical setup was
observed in stocks such as Tata Global Beverages, Manappuram Finance, Gujarat Narmada, Cadila Health, Ujjivan, Indiabulls Real Estate,
Karnataka Bank, Tech Mahindra, TV Today and Linde India.
(Milan Vaishnav, CMT, MSTA is Consultant Technical Analyst at Gemstone Equity
Research Advisory Services, Vadodara
He can be reached at milan.vaishnav@equityresearch.asia)
