Frustratingly Range Bound Show Looks Set To Continue
A slew of reforms for farmers, a boost for infrastructure and banks/ NBFC’s were the key highlights.
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As expected, the budget wasn’t an earth-shaking event for the equity markets, with the NIFTY correcting sharply post the budget speech and making a weak opening Monday morning to boot. A slew of reforms for farmers, a boost for infrastructure and banks/ NBFC’s were the key highlights. Besides that, there was precious little in the budget to actually put more consumption money in the hands of the average Indian, and the markets reacted negatively to that.
On the weekly charts, the NIFTY completed a bearish move by decisively making a lower high. Although we are now very close to the immediate support level at the 20-week moving average mark, it’s quite likely that the lukewarm to negative sentiment will create a further drag on the markets that will take it to the lower Bollinger Band mark which appears to be forming somewhere between 11,200 and 11,300. On the daily charts, the index looks well poised to break down beyond it’s lower Bollinger Band level of 11,638; and with a bearish stochastic crossover firmly in play, it looks all the more likely that we’re going to see the index at levels that are 350-400 points from here, over the next couple of weeks. In the absence of any meaningful impetus, the frustratingly range bound show looks set to continue for now.
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