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By Sameet ChavanWhere we are: We had a nervous start to the week which was in continuation of the previous week’s corrective mode.
During the first half, there were several stocks that took it on the chin mainly on the back of some negative news flow or poor set of quarterly numbers.
However, the last couple of days turned out to be a savior for our markets as we saw a massive rally one day ahead of the Union Budget and on the day as well.
In the process, the Nifty eventually closed a tad below 10,900 by adding nearly a percent to the bulls’ kitty.
What is in the store: One of the most keenly watched events, the ‘Union Budget’, is behind us now.
On the day, the Nifty made a valiant attempt to surpass the recent swing high of 10987.45.
The Nifty successfully defended some key levels.
With this, the index eventually recouped its previous week’s losses and in the midst of an extremely volatile trade, has managed to close relatively in the safer zone.
What should investors do: Although we are yet to surpass 11,000, looking at the broader market participation on Friday, we will not be surprised to see it happening in the forthcoming week.
And since there are some hopes built in on the possible rate cut from the RBI in next week’s policy, this would provide some impetus.
Having said that, Friday’s low of 10,800 would now be seen as a crucial support.
A sustainable move below this may give a dent to all the above-mentioned possibilities.
A prudent strategy would be to keep focusing on individual stocks which have shown resilience of late.
As far as sectors are concerned, auto and metal seem to be heading towards the fag end of their correction.
Traders/investors can look to accumulate names in a staggered manner.
The author is Chief analyst – Technical derivatives, Angel broking
