Last week on Friday, the markets retraced the gains of the entire week to finish the week flat. Let us try and explore what the markets have in store for us.
Fundamentals:
1. The Monsoons have arrived on time and the prognosis is for good monsoons. This should bode well for the markets.
2. The GDP figures have come as expected and are behind us. For all the talk by RBI, the interest Rates should soften.
3. The Hike in Diesel and Petrol prices should underline the Givernment commitment on fiscal stability.
4. The crude oil prices continue to weaken and Brent crude continues to hover around 100 dollars a barrel, which is aother positive for the markets.
5. The only negative factor is the weak Indian rupee. A weak Indian Rupee will wash away the gains made by crude oil falling.
Technicals:
1. Supports are at 5936, 5850 and 5750. I expect 5850 to be tested.
2. If this is a 3 legged correction, then A was 6229 - 5937 = 292 points
B was 5937 - 6134 = 197 points
Now C can extend to 180, 292 or 472 points.
This gives us targets of 5937, 5842 or 5662.
Only below 5627 would this rally be over.
Also, this correction should get over by next week.
So, in a nutshell, it would be a good idea to add stocks on every decline because I believe this rally has legs to ride on.
Fundamentals:
1. The Monsoons have arrived on time and the prognosis is for good monsoons. This should bode well for the markets.
2. The GDP figures have come as expected and are behind us. For all the talk by RBI, the interest Rates should soften.
3. The Hike in Diesel and Petrol prices should underline the Givernment commitment on fiscal stability.
4. The crude oil prices continue to weaken and Brent crude continues to hover around 100 dollars a barrel, which is aother positive for the markets.
5. The only negative factor is the weak Indian rupee. A weak Indian Rupee will wash away the gains made by crude oil falling.
Technicals:
1. Supports are at 5936, 5850 and 5750. I expect 5850 to be tested.
2. If this is a 3 legged correction, then A was 6229 - 5937 = 292 points
B was 5937 - 6134 = 197 points
Now C can extend to 180, 292 or 472 points.
This gives us targets of 5937, 5842 or 5662.
Only below 5627 would this rally be over.
Also, this correction should get over by next week.
So, in a nutshell, it would be a good idea to add stocks on every decline because I believe this rally has legs to ride on.
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