Good Morning & Welcome to Wednesday’s trading action at Dalal Street dated 2nd June 2021.
SGX Nifty is comfortably higher on the 2nd trading day of June, but this mornings’ sluggish action at Asia could perhaps take some wind out of the bulls' sails in today’s trading action.
*The big question: Another day of consolidation?*
*7 AM GLOBAL UPDATE:*
• SGX Nifty (+13, 15644)
• DOW JONES (+46, 34575)
• NASDAQ (-12, 13736)
• BOVESPA (+2051, 128267)
• NIKKEI (-57, 28756)
• HANG SENG (-47, 29421)
Instrument CMP Bias
OIL $68.11 a barrel Positive
GOLD $1905 Positive
Silver 28.03 Positive
USD/INR 72.86 Negative
*INSTITUTIONS:*
• FII: -449.86 Cr
• DII: +230.49 Cr
*THEME OF THE DAY:*
• Global: Positive
• FII: Negative (-449.86 Cr)
• DII: Positive (+230.49 Cr)
• F&O: 15300-16200 zone
• Trend: Up
• Sentiment: Bullish
• Technicals: Higher high/low
• Theme: Buy on dips.
*All ABOUT NIFTY & BANK NIFTY’ CRUCIAL LEVELS*
NIFTY (CMP 15575):
• SUPPORT: 15357/15157
• RESISTANCE: 15757/16001
• RANGE: 15457-15707
• BIAS: Positive.
BANK NIFTY (CMP 35337):
• SUPPORT: 34889/34057
• RESISTANCE: 36497/37709
• RANGE: 34901-36001
• BIAS: Positive.
*THEME OF THE DAY:*
Bulls at Dalal Street will be in action after an overnight interview with Politico, Fed vice chair of supervision Randal Quarles which suggested there will be "different speeds at which supply chains unblock," and that any inflationary pressures that come as a result will likely be temporary. This appeared to help ease investors' worries.
Our *call of the day* however suggests a boisterous day of gains for Nifty on backdrop of reports that the India Meteorological Department (IMD) is expecting more rains in the monsoon months of June-September than its previous estimate in April. Most importantly, the Central India, which constitutes core rainfed agricultural region, to see 6% increase.
Amidst this backdrop, we expect the benchmark Nifty to aim for the 15750 mark and then all aggressive bullish eyes on the psychological 16000 mark. For the day, all bullish eyes will be if Nifty is able to close above 15600 mark.
*Also helping sentiments are positive catalysts like:* Firm global cues as investors express optimism about the revival of the U.S. and global economy.
*Bottom-line:* *Nifty will thrive.* Eye of the storm only below 15151 mark.
Our *chart of the day* is bullish on stocks like DIVIS LAB, UPL, HCL TECH and JINDAL STEEL & POWER with an interweek perspective. IT stocks will continue to thrive. HCL TECH is our preferred bet in this space.
*SHOW ME THE MONEY:* JINDAL STEEL & POWER (CMP 398): Momentum Call: Buy JINDAL STEEL & POWER June Futures for 0-5 days above 409 for an objective of 447/475. Stop 385. Alert: Oversold zone.
*Now, here are other key things to know before today’s market opens:*
• Dalal Street mostly wavered in yesterday’s trade. Volatility was hallmark as investors’ were seen positioning themselves for the upcoming RBI policy meet outcome to trickle in on Friday, June 4th. Well, the monetary policy meet is likely to provide clues about the state of the economy, and the way ahead.
• Technically speaking, buying on dips should be the preferred trading strategy on backdrop of recent sequence of higher high/low on the daily, weekly and monthly time frames. We expect another round of great fireworks display. All bullish eyes on Nifty’s psychological 15750 mark and then aggressive bullish eyes on 16000 mark. Nifty’s make-or-break supports are placed at 15157 mark. As long as Nifty’s 15157 support holds, the benchmark will aim at magical 16000 mark. Intraday support for Nifty seen at 15331 mark.
If Nifty slips below the 15151 mark then its safe to assume that rising covid-19 cases are spoiling the party at Dalal Street.
Please note, Nifty’s 200DMA at 13481 mark. The price action for Nifty in the near term is suggesting that we are likely to see a 15,301- 16200 range in near term with buy on dips as the preferred strategy.
By: via @AlliesFin Serve Stock Market
