Ideal time to create bearish bets
“Once again, our markets opened higher on the back of positive global cues and then consolidated for the major part of the day. Despite RBI monetary policy lined up during the market hours, we didn’t see any volatility, which was quite obvious also as market participants didn’t expect any key announcement from the event.
Eventually, some bit of action seen in the concluding hour and in the process, the Nifty managed to reclaim the 9900 mark with a small margin. Looking at the daily chart, it can be observed that the index has now reached its strong resistance zone of 9920 – 9950 and hence, recent bounce back from 9687.55 can be construed as a pull back towards the ‘Trend Line’ as well as daily ’20 EMA’. As mentioned in the previous article, irrespective of outcome from the event, our cautious stance on the market remains intact. In fact, the outcome was also very much in-line with general consensus. Now, we believe that this is the ideal time for traders with a bearish mind set to create fresh shorts in the market. A protective exit point should be placed beyond 9950 on a closing basis. Although, 9850 – 9830 is seen as immediate support, we would expect the index to eventually slide towards 9775 – 9685 in days to come.”