Hello reader, hope you’re doing well. Markets may start on a cautious note amid steady weakness in the Gift Nifty index, but positive momentum in other Asian indices could have a rub off effect on the local markets as the trading progresses. With the twin US inflation readings showing further moderation, this should boost the confidence of investors ahead of the US Fed meeting in the last week of July. The Nifty Metal index is likely to be a star outperformer as the soft U.S. inflation data spurred bets that global economic growth will not worsen as much as initially thought this year. Another factor supporting the markets have been the persistent FII inflows, which has helped key indices hit new highs in recent months.
Important points to note:
- PSE stocks are seeing a good round of profit booking from the most recent highs, with Powergrid being one of the major movers on the downside, about a 10% correction from last week’s highs.
- Crude oil has had a very swift rally in the last 5 sessions, moving to 6300 levels post breakout above the 6000 mark.
- We can see a retest of 19000 levels on Nifty in the next few sessions. This would be pretty good technicals-wise as it results in filling up of all runaway gaps we’ve had post breakout above 19000, plus a retest gives a cool-off period for everything to gear up for the next rally upto 20500-21000 levels.
As traders we are not looking for the lowest price, but the lowest risk price. This means a stock that has already shown signs of accumulation, is in a longer term uptrend, and is now presenting a setup where you can manage risk.
As always, risk management is key, and a proper system in place prevents one from losing out too much, in case of outlier events. Have a good trading day, and may the force be with you!
Disclaimer: this post is for educational purposes only, we are not SEBI registered analysts. Trades mentioned here are not trade recommendations. Equity Investments are subject to 100% market risk, please consult your financial advisor before investing.