Nifty Prediction for tomorrow 12th May 2021

Nifty Prediction for tomorrow 12th May 2021 Nifty trend remains sideways within the broad trading range. Stock-specific trading must be done. Avoid Nifty for the time being till we do not have a range breakout.

Nifty prediction remains the same. Overall Nifty has resistance around 15000 and support around 14000. Nifty will remain in a broad trading range for now. Unless and until we see a breakout with volumes sustaining outside this area no trending move will take place. Avoid option buying since momentum is missing option buyers will only keep losing because of time decay.

The idea should be to look for trending counters like Gold or Silver for taking trades in the direction of the main trend. We continue to remain long on gold and have been making good profits there. 

Nifty Prediction for rest of 2021

So some of you were asking me about the situation that I suggested yesterday. Hyperinflation will lead to stagflation sometime during the year. So there have been many companies that have red-flagged inflation. Honeywell has said inflation is already a concern. Nestle has mentioned margins will be under pressure. Even the great Warren Buffet also has said steel prices and lumber prices just keep moving “up, up and up” so eventually this will lead to stagflation. Even Pepsi has said that in 2021 we should see higher input cost.

Higher inflation, lesser disposable incomes, low growth, rising interest rate scenario coupled with valuations that are sky high and stock markets have priced in sharp recovery so in this sort of a background we see headwinds for the higher side while downside risk increase. I am not suggesting that we short tomorrow morning. All I am saying risk in such an environment for downside are sharply higher. Selling must only be done once we see a confirmed breakdown.


Nifty Prediction for tomorrow

Nifty Prediction for tomorrow


Bank Nifty Prediction for tomorrow

Bank Nifty also looks now like a sell on rise but some more rise possible. The near lockdown across the country will eventually add to higher NPA’s and thereby having an effect on the bottom line profits. Be that as it may. Trend here for now too is sideways but with a negative bias. State Bank of India looks like can test 290 if we see some conditions being met. If and when we have to short sell State bank of India we will update our clients on the same.

As usual, if you are only trading on the basis of this post please use your own risk management and then only trade. Please do not over-trade and always keep your risk in check. 

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Regards,

Glen Drago

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