NIFTY
It should come no surprise that the revelations about certain tip givers have actually front run and then post their show they liquidate.
It is utter disregard to fiduciary relationship, when ethics are thrown, the result is pathetic. Poor retail who gets the burn out from his hard savings. The "G" shock is sooner or later.
As we write, show your finger, it flies is the kind of overnight analysts that have cropped up.
This is typical of wave 5 behaviour and hence, it is bound to come time and again irrespective of what measures one takes, the only approach is to identify it as wave - 5.
#SEBI instead of the current mandate, it is time, whoever comes and gives opinion should be mandated to buy or sell a particular quantum of absolute value, buy after a day or close of the day or sell in similar fashion. Unless one is made to hold the actual recommendation, it is of no value. This can be debated in depth.
Will the froth of front run will take its time, what is the end result is using one brush to all and looking every space that has gone up multiple of X in recent past. Perils of the markets. Let's face it.
The far-off area turned out reality, bears tightened their grip. In ability to even tough the previous day high and close near the 14 Day MA of the respective time frame all sings we move lower, towards the 20800.
Sell is a better risk reward with appropriate hedging, negates the view close above 21880.
With weekend, no real cues, (Nikki is in its own world and it is one of the cleanest graphs of recent times for the bulls).
Markets would like to discount the negative news and ignore the positive news going forward till the dust settles. When Momentum is stopped, the reverse is not the immediate response, it goes haywire.
The Stock RSI in the graph after printing oversold, did rise, but look at the recent instances, markets did try one more fall since the thrust fails to move past the min required to call as bottom. We are in for such an move.
NIFTYBANK
The much awaited RBI policy comes and goes, re-read our yesterday posting.
1. What is not said is more important than what is said.
2. It is not the news, but the reactions to the news.
2. Focus on Digital Space and regulation, you got lots on this front too.
Some cryptic messages form the policy.
1. Liquidity is ample contrary to market perceptions we did two VRRR (clearly suggesting no rate cuts.
2. Global path is still not to cut early, so that tells that no solace in borrowing the cues as nonpresent.
3. Will remain nimble - cuts both ways. Concern on Food Inflation, while Core has more or less on descent (Contrary to the global sticky core and comfortable volatile component).
With so many restrictions on export of food items, either Rice, or Sugar (taking out on ethanol blending), the ground for inflation to fall further is limited room looks the assumption, not hawkish, but no room to be dovish.
All spaces that are prone for increase in cost of funding, or the scope for lesser asset accretion, more importantly private banks takes the beating. PSU's rule the roost. Save a few.
In terms of vital TA space HDFC, Bandhan, Kotak are below their 200 DMA and will continue to be so. PSU banking space rallied a lot and some corrective moves are not ruled out, but their long-term horizon looks healthy.
From the Graph, the Horizontal Line or the arrow is the line in sand for the bulls, hopefully we hold, else it would be deep dive.
Previous low of 44200-44600 is eyed, while we stay below 45400. Action in spaces to focus than as an Index.