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Last Updated : Feb 20, 2019 07:09 AM IST | Source: Moneycontrol.com

A morning walk down Dalal Street | Nifty likely to be range bound, retest 10550-10500 levels

Investors are likely to keep an eye on movement of crude oil price and rupee vs USD, both of which are unfavourable for the economy currently.

 
 
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It was not a terrible Tuesday but 8 days of selling on D-Street resulted in a fall of over 1600 points on the Sensex and about 464 points on the Nifty50.

Geopolitical concerns have added to some uncertainty on D-Street especially after Pakistan Prime Minister Imran Khan's comments saying the country will retaliate if India launches military strikes in the aftermath of the Pulwama terror attack.

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Market displayed signs of sell on rallies markets as investors booked profits soon after it reclaimed 10700 levels. The fall was largely led by large-caps stocks which experts now feel that could see more pressure.

The positive takeaways from Tuesday’s trading session was the fact that broader market outperformed benchmark indices.

Some bad news on the banking front. Financial institutions that have lent money to IL&FS group companies could be collectively staring at a write-off of nearly Rs 30,000 crore, a source told Moneycontrol. The Nifty Bank closed 0.1 percent higher on Tuesday.

In absence of any important domestic triggers, analysts remain cautious on the market and expect it to be range bound and retest 10550-10500 levels.

Investors are likely to keep an eye on movement of crude oil price and rupee vs USD, both of which are unfavourable for the economy currently. On the global front, positive progress on China-US trade talks in Washington may boost sentiments

On the institutional front, FPI were net sellers for Rs 813 crore while DIIs were net buyers for an amount of Rs 1163 crore, provisional data showed.

Big News:

The Nifty50 logged its biggest losing streak since 2015 as it dropped for the eight consecutive days in a row, but managed to close a shade above 10,600 levels.

For Sensex, it was the biggest losing streak since July 2013 when the index fell from July 24 t0 August 2n wiping out nearly 1,000 points.

The last time when Nifty50 fell consecutive for 8 straight days was back in March 2015 when the index was trading around 8,600 levels. The index fell from 18 March 2015 to 27 March 2015, translating in a fall of 344 points.

Technical View:

The Nifty formed an ‘Inverted Hammer’ kind of pattern on daily charts

If market closes in a positive zone then it shall act as a trend reversal sign in favour of bulls which shall get further strengthened if Nifty manages a close above 10,722 levels which is the intraday high on Tuesday's session.

Three levels: 10585, 10600, 10722-10759

Max Call OI: 11000, 10800

Max Put OI: 10400, 10500

Technical Recommendations:

We spoke to SMC Global Securities and here’s what they have to recommend:

Dalmia Bharat Sugar and Industries: Buy| Target: Rs 112| Stop Loss: Rs 94| Upside 12%

Power Finance Corporation: Buy| Target: Rs 115| Stop Loss: Rs 100| Upside 9%

ICICI Lombard General Insurance Company: Buy| Target: Rs 1022| Stop Loss: Rs 860| Upside 11%

Disclaimer: The views and investment tips expressed by investment expert on moneycontrol.com are his own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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First Published on Feb 20, 2019 07:09 am
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