SGX Nifty Futures
(Change Vs Today’s Nifty Futures (NSE) Closing)
Error parsing: Query returned empty response
Nifty Futures Update 29th Nov 2016
Nifty Futures / SGX Nifty closed the day marginally in the green post the gap down opening seen today morning.
Some may argue with the fact that rupee has been very weak off late and cutting deposit rates means lower bond prices which fell almost to a 7 year low to 6.1 percent last week so many may argue that RBI may not move because of the rupee for the fear that rupee will witness a further pressure due to the outflows from bonds but personally I see that equity inflows will take care of that part of the problem and I do not see that if rate cut and sharp rate cut takes place then beyond a few minutes it will impact the rupee but anyways regardless of whatever the rupee does it does not matter because frankly what choice do the banks and RBI have? The only way for them is to ensure sharp rise in credit off take and we see that happening at lower rates from current levels. The move by SBI last week signals that very same thing that what options are available and logically there are no options available for now other than cutting rates drastically and keep in mind that it is nothing but a time bomb the more time these people take the larger the degree of the rate cut will have to be it is as simple as that, if the banks and RBI start cutting now then and only then can this problem of excess liquidity be take care of.
Nifty in the near term we do not see much downside though we could see volatility and then whenever the news of rate cut comes in we could see a very sharp rally though we do not see that lasting for long but in the near term we do not see any sense in being short. The sentiment indicator also which we have developed shows almost same reading that we have seen at around the 6900 levels last seen in late FEB 2016 so when suddenly nobody wants to buy and everyone wants to just sell that has always been a area of a sharp pullback and we believe that history repeats itself and future is nothing but a repetition of the past so same sentiment indicators suggest that near term short selling will not make money but please keep in mind that once this pullback ends we see prices heading lower towards the 5872 target so this is not a buy and hold zone it will be a trade in and trade out and in between in this pullback also we do expect to see a lot of volatility so if you are only trading on the basis of this post then please use appropriate risk management and then only trade. Please do not over trade and keep your risk under control at all times.
Good Trading To You!