FIIs were net sellers of equity on all three trading days this week. Their total net selling was worth Rs 26.1 Billion. DIIs were net buyers of equity on all three trading days. Their total net buying was worth Rs 27.9 Billion, as per provisional figures.
RBI's transfer of Rs 1.76 Trillion surplus to the government has drawn wide-spread criticism from 'Harvard economists'. It is unfortunate that the first action of the 'hard work economists' to tackle the economic slowdown was to put their collective hands inside RBI's till.
As per Moody's, the 'booster package' announced by the Finance Minister on Fri. Aug 23 may boost investor and business sentiments, but won't be able to prevent India's GDP growth to slip to 6.4% for FY 2019-20.
The following remark was made in last week's technical update on the daily bar chart pattern of Nifty: "Nifty's previous (Aug 5) low of 10783 may get tested, and breached."
The day after breaking out below a 'rising wedge' pattern, the index fell below its Aug 5 low of 10783 and closed just below the lower Bollinger Band at 10741 on Thu. Aug 22.
On Fri. Aug 23, Nifty touched an intra-day low of 10637 but bounced up on short-covering after rumours of a 'booster package' from the Finance Minister - forming a 'reversal day' bar (lower low, higher close) that often marks an intermediate bottom.
The effect of the 'booster package' - announced after close of trading on Friday - lasted two days. On Mon. Aug 26, Nifty rallied strongly and closed above its 20 day SMA (middle Bollinger Band - marked by green dotted line).
There was some follow-up buying on Tue. Aug 27, but the index formed a 'doji' candlestick that indicated uncertainty among bulls and bears. An intra-day pullback to the 20 day SMA today and some short-covering before tomorrow's monthly F&O expiry took the index to a close just below 11050.
A dark cloud of resistance is looming overhead (marked by grey oval) - consisting of the upper Bollinger Band and rapidly merging 50 day and 200 day EMAs. The 'death cross' of the 50 day EMA below the 200 day EMA will technically confirm a bear market.
Daily technical indicators are giving mixed signals. MACD is rising above its signal line in bearish zone. RSI has started to fall after facing resistance from its 50% level. Slow stochastic has risen to the edge of its overbought zone. Any further index rally is likely to be short-lived.
Nifty's TTM P/E is at 27.33, which is inside its overbought zone and much higher than its long-term average. The breadth indicator NSE TRIN (not shown) is falling inside its oversold zone, hinting at some near-term index up side.
The 'booster package' from the Finance Minister came 'too little, too late'. No major reform announcements were made. The 'low hanging fruit' (RBI surplus) has been plucked. It will be interesting to see what happens next if the economy continues to slide.
FMCG giant HUL has announced 20-30% price cuts on soaps. Maruti has announced lay-offs. Q1 (Jun '19) results showed continued tepid earnings growth. The only 'animal spirits' visible are of the bearish kind.
RBI's transfer of Rs 1.76 Trillion surplus to the government has drawn wide-spread criticism from 'Harvard economists'. It is unfortunate that the first action of the 'hard work economists' to tackle the economic slowdown was to put their collective hands inside RBI's till.
As per Moody's, the 'booster package' announced by the Finance Minister on Fri. Aug 23 may boost investor and business sentiments, but won't be able to prevent India's GDP growth to slip to 6.4% for FY 2019-20.
The following remark was made in last week's technical update on the daily bar chart pattern of Nifty: "Nifty's previous (Aug 5) low of 10783 may get tested, and breached."
The day after breaking out below a 'rising wedge' pattern, the index fell below its Aug 5 low of 10783 and closed just below the lower Bollinger Band at 10741 on Thu. Aug 22.
On Fri. Aug 23, Nifty touched an intra-day low of 10637 but bounced up on short-covering after rumours of a 'booster package' from the Finance Minister - forming a 'reversal day' bar (lower low, higher close) that often marks an intermediate bottom.
The effect of the 'booster package' - announced after close of trading on Friday - lasted two days. On Mon. Aug 26, Nifty rallied strongly and closed above its 20 day SMA (middle Bollinger Band - marked by green dotted line).
There was some follow-up buying on Tue. Aug 27, but the index formed a 'doji' candlestick that indicated uncertainty among bulls and bears. An intra-day pullback to the 20 day SMA today and some short-covering before tomorrow's monthly F&O expiry took the index to a close just below 11050.
A dark cloud of resistance is looming overhead (marked by grey oval) - consisting of the upper Bollinger Band and rapidly merging 50 day and 200 day EMAs. The 'death cross' of the 50 day EMA below the 200 day EMA will technically confirm a bear market.
Daily technical indicators are giving mixed signals. MACD is rising above its signal line in bearish zone. RSI has started to fall after facing resistance from its 50% level. Slow stochastic has risen to the edge of its overbought zone. Any further index rally is likely to be short-lived.
Nifty's TTM P/E is at 27.33, which is inside its overbought zone and much higher than its long-term average. The breadth indicator NSE TRIN (not shown) is falling inside its oversold zone, hinting at some near-term index up side.
The 'booster package' from the Finance Minister came 'too little, too late'. No major reform announcements were made. The 'low hanging fruit' (RBI surplus) has been plucked. It will be interesting to see what happens next if the economy continues to slide.
FMCG giant HUL has announced 20-30% price cuts on soaps. Maruti has announced lay-offs. Q1 (Jun '19) results showed continued tepid earnings growth. The only 'animal spirits' visible are of the bearish kind.
No comments:
Post a Comment