The reaction of Indian equities’ to the repo rate cut by the RBI yesterday (positively surprised), is perplexing. It was a classic case of “buy the rumour, sell the fact” – the benchmark indices (NSE/BSE) posted handsome gains on the day before the MPC announcement – remained range-bound on the day of interest-rate cut declaration – and then plummeted substantially on the day after the big event.
On the Nifty’s daily candlestick chart, price pattern formation looks slightly disturbing. An Evening Doji Star# is formed at the recent high. Such a price pattern formation, at the end of an uptrend indicates bearishness. There is a trendline resistance around 11100 (pink line connecting the recent peaks). Momentum indicators (RSI and Slow Stochastic) have started to decline from overbought regions.
My bet is on a short term weakening of the Nifty. The target is towards 10600-10700. If the Nifty breaks above 11100 and forms a new peak, this assessment will be nullified.
# An Evening Doji Star is a three-day candlestick pattern. When formed at a peak, it gives a bearish reversal signal.
First day is a large white body (continuation of the existing uptrend).
Second day it opens higher, trades in a small range, then closes at/near its open (a Doji formation – first indication of indecision).
Third day it closes below the midpoint of the body of the first day.
Date : Feb-2019
18-Apr-2019 6:45 PM
After posting superlative gains in March, due to resurgent FII inflows, rupee has been range-bound
16-Apr-2019 6:10 PM
With a look at Silver chart shows that price action took resistance at $14.92 levels in July’18, October’18
15-Apr-2019 5:46 PM
A look at the daily chart is showing that USDINR is trading in between the range of a downward sloping trend channel
12-Apr-2019 6:53 PM
Indian exporters are a worried lot these days. USDINR around 69, EURINR at 78 and GBPINR near 90-91
11-Apr-2019 6:26 PM
10-Apr-2019 5:55 PM
Pound has been sitting at the edge of the sword with EU and Britain deciding to extend