The markets formed a Doji last week signalling indecisiveness. The markets corrected on Friday giving up all the gains of the previous week. The RBI policy is key on Tuesday to see if the rates will be hiked. The markets are just meandering waiting for a trigger.
1. The FIIs have not bought big time in January and that may be the reason for the markets not making a very big up move.
2. With the tightening of liquidity, with the QE tapering, all emerging markets currencies are weakening. India has not weakened as much as the other currencies.
3. The Q3 Results are out of the way and that is 1 more trigger less for the markets.
4. The opinion polls are suggesting a BJP victory in May. I will post a more detailed write up on how to play the elections on Wednesday.
5. If we look at the Technicals, 6130 is a strong support and till we break it, it is just a minor correction.
I had said last week,
"6130 - 6358 and beyond this 5900 and 6420 are the key breakout points to watch out for."
This statement holds true. We touched 6358 and came back within the range. The markets will continue meandering in this range unless we get some meaningful triggers.
The RBI policy may give a short term move. It all depends on whether the lower fiscal deficit will encourage the RBI Governor to hike rates to tame inflation especially when the growth forecast has improved.
1. The FIIs have not bought big time in January and that may be the reason for the markets not making a very big up move.
2. With the tightening of liquidity, with the QE tapering, all emerging markets currencies are weakening. India has not weakened as much as the other currencies.
3. The Q3 Results are out of the way and that is 1 more trigger less for the markets.
4. The opinion polls are suggesting a BJP victory in May. I will post a more detailed write up on how to play the elections on Wednesday.
5. If we look at the Technicals, 6130 is a strong support and till we break it, it is just a minor correction.
I had said last week,
"6130 - 6358 and beyond this 5900 and 6420 are the key breakout points to watch out for."
This statement holds true. We touched 6358 and came back within the range. The markets will continue meandering in this range unless we get some meaningful triggers.
The RBI policy may give a short term move. It all depends on whether the lower fiscal deficit will encourage the RBI Governor to hike rates to tame inflation especially when the growth forecast has improved.
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