Nifty Futures 7th March 2018
Nifty Futures today has broken the lower end of the trading range of 10276 that it has been in since the past one month. In our previous stock market update / Nifty prediction we had mentioned that although pullbacks will come from time to time we do not see them sustain and today was a classical bull trap early in the morning. Most people were felling that the worst is over and Nifty is heading higher but as we have been saying that Nifty is under performing most global stock markets and that the open interest data is indicating that most traders and investors were averaging their long positions and everyone whoever was averaging has a stop loss around the 10274-10250 spot Nifty levels area. Now since that level has been taken out we do expect to see some panic selling which will set in as per our analysis.
Many people have been asking me that why is Nifty Futures / Indian Stock market underperforming the global stock markets and the reason is that India’s macro picture does not look good and has been getting from bad to worse. The Banking problem is the latest set of problems which will force interest rates higher and much more faster than what most of the street is expecting. In our updates we had mentioned that the banking system problem is not isolated to PNB alone and we see some problems in SBI, Icici bank and Axis Bank also. The quantum of the problems will be known over the next few days but the outcome of this is that cost of capital will move very quickly and also bankers will now become very risk averse which means that the first hit will be borne by the mid cap and small cap companies.
From a near term perspective we see Nifty heading lower on break of 10274 which has happened today. It will be very interesting to watch the market over the next 2-3 days as we do expect lot of margin calls to trigger so although pullbacks can come we don’t see them sustain because very important range has been broken. We will update more to our clients.
Part of what we recommended to our clients
3/6/18, 9:11 AM – Glen Drago: Gm3/6/18, 9:11 AM -Glen Drago: Hold positions as told3/6/18, 9:11 AM – Glen Drago: Will update if anything has to be done3/6/18, 3/6/18, 10:10 AM – Glen Drago: Nifty Futures today has given an bounce back from yesterday’s lows which is perfectly in line with estimates. As per our Nifty prediction for the coming time we see that this current pullback will be the last major pullback and post that we will resume the down trend which will take Nifty significantly lower than what most people are estimating. We know that most people are expecting a target of around 10100 if we break 10270 on spot Nifty levels but we see Nifty even moving below that eventually because we do not expect or see that Nifty will hold 10274. The next wave which will begin on the downside will be very fast so just hold the positional shorts as told and add and trade in and out as per messages given for STBT trades. If for any reason you are stuck in your portfolio then do not average for now and wait for our message to average because till this current wave does not end no meaningful pullback will come and if no meaningful pullback comes then averaging net longs will lead to major problems within the next few days. As we have mentioned yesterday that overall we see any pullback sustaining nor do we expect short covering because the over all Open interest shows or is indicating that janta has kept on averaging at all levels and it is no rocket science that everyone’s stop loss for that trade is around or between 10250-10275 spot Nifty level or with regard to Nifty Future level around the 10280 area so give or take a few points and once this area is taken out which it will as per our Nifty Future Prediction then we do not see markets holding out 10100 levels. It is also possible that we could gap down directly below those levels and have just 2-3 sharp fall days on very similar lines to the fall that we did see in the markets around 1st week of Feb. So hold positional shorts that we have built and we will keep trading in and out as deemed fit using the STBT trades. Hold positions as told. Will keep updating if anything else needs to be done. 3/6/18, 12:54 PM – Glen Drago: We have been guiding that PNB like problem is there in Axis ICICI and SBI and we expect that news to start coming out. As of now names of axis and ICICI bank have started to come out but as per our information many top guys may be in connivance in the system . That could be the possible trigger for Indian stock markets to tank and underperform even more than what currently is on going3/6/18, 12:55 PM – Glen Drago: Will keep updating if anything needs to be done3/6/18, 12:55 PM – Glen Drago: Nifty continue holding 4 parts positional shorts as told3/6/18, 12:55 PM – Glen Drago: If and whenever we have to add via stbt trade will update3/6/18, 2:24 PM – Glen Drago: Nifty hold 4 parts positional shorts as told3/6/18, 2:25 PM – Glen Drago: If anything else to do will update3/6/18, 3:16 PM – Glen Drago: Nifty hold 4 parts positional shorts as told3/6/18, 3:16 PM – Glen Drago: Shanti karke baitho3/6/18, 3:16 PM – Glen Drago: Whenever we have to do anything will update3/6/18, 3:18 PM – Glen Drago: Till now the SBI account details are not out. We expect that no and details of that to really spook the market3/6/18, 3:18 PM – Glen Drago: Margin calls should begin now
Good Trading To You!