The Nifty is above 5,100 and tomorrow is the monetary policy and the day after is the Federal Open Market Committee (FOMC) where the US Fed will decide how much more the rates need to be cut, We have got enough triggers; more than enough triggers this week  - credit polices, global news, earnings and the market is just trying to break out of its 200 DMA after a long time.

It was a fantastic close on Friday, 5,100 on Nifty and more than 17,000 on the Sensex. So I think there will be hope going into trade this week. But you have got lots of potential triggers, each of them have the potential to swing the market either way and by substantial margins. The monetary policy certainly does, the FOMC meeting probably has the teeth to change the course of global markets as well and you have got plenty of big earnings stacked up. So I do not know how we will end this week. But we are starting with a note of confidence and I think even technically speaking, the markets are just poised around extremely critical level. So it is a bit of a crossroads kind of situation as we start trade and I think by the end of the week, you would have found at least near-term course of the market for the May series.

Asian Indices:

Important Monday morning of trade and with exception of China which is down 2% and other markets are stable, 0.5% up, flat, 1% up so Asia on balance you would have to say stable not usually positive not usually negative.

This is a super stacked big week for us?

It is, there are just too many triggers out there. I think the market will probably do the thing of waiting and watching till this week is over. It is only 4 trading sessions, we have already had a nice little pullback, and these are not short term cues. What the Reserve Bank of India (RBI) does in its policy is not an inflation number for one week; it actually has deep ramifications on the whole financial market turf for the remainder of the year.

It is a big event and globally too it’s a big event what the US Fed chooses to do. Don’t undermine earnings because last week the markets swung around quite a bit on the earnings calendar as well. Bharti was one of the more important reasons why the market struck out that big rally on Friday and this week we have got plenty of them, we have got Lever today, DLF, which is a potentially important number, it is a beaten down space, we have Reliance Capital, IDFC in the financials, State Bank of India (SBI) comes in with numbers this week as well. There is Reliance Communications as well, so I think there are enough numbers of big earnings coming in this week to swing the markets.

We are at an important level and there are at least 3 triggers if we want to club them patched up over the next 4 days, and then we will probably get a better sense of direction. Right now, trying to preempt the market’s move but in 2-3 days time you will probably have the events before you and when you come back for trade on Friday, you will get a clear sense of whether the market’s good for the near-term.

Technically talk has begun of that 200 DMA for the Nifty in that sense as well it’s poised at an interesting place?

That’s the thing that all triggers have come in at a point, when the markets are trying to break an important technical level. So it will be a make or break week either way, if the policy action in the local and the global markets are supportive we could have a situation where for the first time since the Union Budget we  will be able to trade above the 200 DMA.

Some people follow technicals and some do not follow technicals but that 200 DMA is something, which everybody keeps an eye on, you could choose 50-100-500 anything but generally it has some kind of importance and the market is trying to break out above that.

I suspect that each of these triggers will play a role in deciding whether the Nifty can get above 5,150 roughly and keep its head above the 200 DMA, which is the first sign of a recovery in strength in the market. So even if there is to be life beyond the 17,200-17,300 level for the Sensex, which people have been talking, about which is another couple of 100 points from here, whether we can stay above that and then try and look another 5-7% from those levels. Either way technically, fundamentally in terms of triggers whichever way you look at it this is completely staked up week. But I suspect by Friday you will have an answer to whether 200 DMA becomes a ceiling above our head once again, from which we get pegged back into the trading range or you can form a fresh range in the market right now by trading above it.

On global cues

The FOMC of course will be the decider but the other encouraging thing is that, there is a little bit of promise on the Foreign Institutional Investors (FIIs) front as well. The last reported figure was USD 130 million, on Friday too they bought about Rs 300 crore cash nearly Rs 700 crore of Nifty futures. So one is getting the sense that some amount of confidence is returning, for half of the earnings season, there have been no big howlers so far. Some hits and misses always happen, but it’s not the kind of earnings season where we are just falling off the table or anything like that. There have not been huge disclosures on mark-to-market as the market had feared earlier. Some of these events plus the whole global market situation might be giving the FIIs a little bit more confident to come in and test the waters a bit, which is very good and positive.

What the Fed does, what it says will be important, I don’t think they will surprise the market but they will do 25 at least because they don’t want to rattle the sentiment, when its just forming but if they sound a bit hawkish going forward then the markets might just recoil a bit.  Most markets have rallied between almost close to 20% across the world, with the exception of the US, so coming on the back of the strong pullback of the market if you get a little bit of a hawkish kind of a voice from the Fed you might get just pegged back once again.

It is an important week for global markets as well, and we come back to trade on Friday one day after the world will react to the Fed.