NIFTY SET TO ACHIEVE 11495 TARGET; TRAIL STOP-LOSS TO 11320

NIFTY SET TO ACHIEVE 11495 TARGET; TRAIL STOP-LOSS TO 11320

WORLD MARKETS

US indices fell 0.1%-0.3% on weak retail sales data, coupled with persisting trade-war fears.

Retail sales unexpectedly dropped 0.3% in September, marking their first decline in seven months.

The Wall Street Journal reported there are questions about how much more in U.S. agricultural products China will actually buy and for how long. Bloomberg News said China wants U.S. tariffs on Chinese goods rolled back before moving forward with the purchases. Meanwhile, Trump said a deal probably won’t be signed until his meeting with Chinese President Xi Jinping in Chile next month. He noted the deal was currently being worked on.

Also, China threatened to take countermeasures against the U.S. in response to a bill favoring protesters in Hong Kong.

Bank of America reported better-than-expected earnings and revenue for the third quarter, sending its stock up 1.5%. United Airlines, meanwhile, rose more than 2% on earnings that topped expectations.

In Europe, FTSE and CAC fell 0.6% and 0.1% respectively while DAX rose 0.3%. Brexit negotiations hit a wall according to media reports over a future trade deal and fair competition clauses.

On the data front, U.K. consumer price index inflation for September roughly matched expectations to grow 1.7% year-on-year, while euro zone CPI rose 0.4% on the month and 0.8% on the year. Italy saw its EU-harmonized inflation rise 1.4% month-on-month in September.

Brent crude rose 1% to $59.34 a barrel while U.S. crude gained 55 cents, or 1%, to settle at $53.36.

AT HOME

Sensex and Nifty gained 0.3% and 0.24% respectively, extending the winning streak to fourth straight day. Sensex settled at 38598, up 92 points while Nifty finished at 11471, up 43 points. BSE mid-cap index fell 0.1% while small-cap index rose 0.2%.  BSE Oil & Gas and Realty indices climbed 1.2% and 1.1% respectively, becoming top gainers among the sectoral indices while Power and Utilities indices were the top losers, down 1.1% and 0.9% respectively.

FIIs net bought stocks, index futures and stock futures worth Rs 686 cr, 408 cr and 746 cr respectively. DIIs were net buyers to the tune of Rs 1577 cr.

Rupee appreciated 10 paise to end at 71.43/$.

OUTLOOK

Today morning, Shanghai is flat while Hang Seng and Nikkei are up 0.5% and 0.2% respectively. SGX Nifty is suggesting a flattish start for our market.

At the risk of repeating, after Nifty achieved 11390 target, which was the 50% retracement level of the recent 11695-11090 fall, we have been working with next target of 11495, which is the 67% retracement level of the aforementioned upmove.

Nifty yesterday touched a high of 11481 before closing at 11471, coming in very close to 11495 target.

11495, the 67% retracement level of the 11695-11090 fall, continues to be next upside target/resistance to eye. If that is taken out, 11640, where a downward sloping trendline adjoining tops made in June and July is placed, would be the next target.

Meanwhile, immediate support on the hourly chart has moved up to 11320, with the stop-loss of which, trading longs can be held on to

ZEE Entertainment, TVS Motors, PVR and L & T Infotech will report their quarterly earnings today.