NIFTY REBOUNDS FROM OUR INDICATED SUPPORT LINE; 11850-11850 IS THE RESISTANCE ZONE

NIFTY REBOUNDS FROM OUR INDICATED SUPPORT LINE; 11850-11850 IS THE RESISTANCE ZONE

WORLD MARKETS

US indices surged 1%-1.4% after U.S. President Donald Trump said in a tweet he had a very good telephone conversation with Chinese President Xi Jinping and that both would hold an extended meeting at the G20 summit later this month.

US oil rose $1.75 or 3.4% to $53.90 a barrel while Brent added $1.07 or 1.8% to reach $62.01.

European markets climbed 1.2%-2.5%. A speech from European Central Bank President Mario Draghi suggested that the ECB will provide more stimulus, either through new rate cuts or asset purchases, if inflation does not pick up.

AT HOME

Benchmark indices ended higher by a fifth of a percent after a choppy session, with Sensex breaking 4-day losing streak. Sensex settled at 39046, up 85 points while Nifty added 19 points to finish at 11691. BSE mid-cap index gained 0.1% but small-cap index fell 0.4%. BSE Oil & Gas index climbed 1.1%, becoming top gainer among the sectoral indices, followed by 0.8% higher IT index. Healthcare and Auto indices were the top losers, down half a percent each.

FIIs net bought stocks, index future and stock futures worth Rs 32 cr, 119 cr and 53 cr respectively. DIIs were net buyers to the tune of Rs 181 cr.

Rupee appreciated 20 paise to end at 69.70/$.

OUTLOOK

Today morning, Hang Seng is leading Asian markets with gain of more than 2.5% while Shanghai and Nikkei are up 1.9% and 1.7% respectively. SGX Nifty is suggesting about 60 points higher start for our market.

In yesterday's report we had said that "11657, the low made yesterday, also coincides with lower band of bollinger on daily chart as well as a downward sloping trendline adjoining recent bottoms on hourly chart and hence is the immediate support to eye".

Nifty touched a low of 10641, which exactly coincided with the downward sloping trendline mentioned above, from where it recovered to end at 11691 and is set to open around 11750 today.

11800 is the immediate hurdle on the hourly chart, which will be followed by 20-DMA placed around 11850, making 11800-11850 immediate resistance zone.

On the way down, 11641, the low made yesterday, is the immediate support to eye, below which 11591, the upper end of the gap created by big gap-up opening after the exit polls, would be the next support.

The Fed, at the end of its two-day policy meeting today, is expected to leave rates unchanged. However, investors will monitor whether policymakers at the central bank lay the groundwork for rate cuts later in the year.