Nifty Outlook for 13th July, 2016

Nifty Outlook for 13th July, 2016

  5:57 PM    Unknown

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NIFTY CHART OF THE DAY

Nifty Trend	In 60 minutes	In Daily	In Weekly	In Yearly
Nifty (Spot)	UP	UP	UP	UP

Market commentary: Nifty Spot

Nifty Spot: 8500 conquered and scaling up towards 8650.

Nifty continues its ride on upside with 8650 round the corner. Technically, the price action is still within the bullish channel aiming towards the upper end of the channel, likely around 8700 mark. As we noted yesterday, Nifty could face stiff resistance at around 8633 – 8650. A correction from thereon would make this leg much stronger. One observation that supports the bullish view is the stocks make a selective move. Unlike any other time when we see markets peeking, this time around we see only selective and quality stocks are making a move, which indicates more legs to the bullish market. Investors need to worry when all stocks irrespective of quality (fundamentals) move crazily. Once the upper channel is conquered, and if there is a healthy correction; that calls for more investments into our market.

Nifty Spot: The next leg down will commence soon, watch out for 7980 – 7950 to be broken first.

Let us sit back and analyse the entire move up right from 6825. 6825 was an important technical support level, which is exactly 50% retracement from the entire leg up which was in place from 2014. It was during the day of budget, due to announcement of 3.5% deficit and giving hope for a rate cut from central bank, the market move smartly from 6825. The hope rally began very swiftly. Then came less than anticipated rate cut, however there was still hope as governor said further rate cut is possible if monsoon is normal. We saw the largest drop post announcement in the entire leg up. Hope still continues as soon as MET department announced, we will have better than the normal monsoon, and Nifty moved towards 8400 mark. If you were to analyse, one thing is for sure, the entire move up was built on ‘hope’. Now it is time to test reality. If we can hold on to 6825 in the next leg down, we are going to see another Bull Run in Nifty, if not ‘hope’ would turn out to be ‘nightmare’.

Nifty Future: Positional & Intraday guidance

For intraday traders (Nifty Future) try to do jobbing on both the sides of market movement. You can use the levels given below to trade accordingly.

Instrument	Action	Entry	Target 1	Target 2	Target 3	Target 4	Stop Loss
Nifty (July Fut.)	Buy Above	8533	8552	8575	8598	8621	8510
Nifty (July Fut.)	Sell Below	8510	8491	8468	8445	8422	8533