Last week – review
Indices remain flat for this week after less volatile session in narrow range, we expected indices to given clear directional move, but failed. RBI MPC kept repo rate unchanged at 6.50% and maintain its stance as “Withdrawal of Accommodation”. Reaction to monitory policy & post policy press conference was weak and Banknifty corrected on Thursday.
Technical Insight
• Nifty RSI @ 59.85 & RSI average @ 64.65. RSI after testing 70 level this week again turned negative, Nifty immediate support at 18508 & 18458 would be important resistance comes at 18777.
• Banknifty RSI @ 56.23 & RSI average @ 59.65. Banknifty trade in very narrow range in this week where RBI MPC event was there.
Approach on Technical: Indices failed to build on momentum could be considered as negative in near term. RSI & RSI average on Nifty & Banknifty indicates further consolidation.
Nifty below 18458 & Banknifty below 43552 – needs to be turn cautious. Indices continue to trade near its lifetime high, could expect another round of up move if supported by momentum. Nifty above 18666 & Banknifty above 44360 could open upside up to Nifty @ 18965 & Banknifty @ 44959.
Fundamental Insight
1) RBI MPC Keeps Repo Rate Unchanged; Inflation Still Above Target, Says Das
2) RBI Monetary Policy: Banking System Liquidity Appears To Be Skewed, Says RBI Governor
3) Southwest Monsoon Arrives In Kerala: IMD
4) World Bank Trims India’s GDP Growth Forecast To 6.3% In FY24
5) India Likely To Stick To The Market Borrowing Plan For FY24
Equichain Wealth Advisors – Market View & Strategy
Last weeks narrow movement has turned as cautious again, however we continue to remain positive on market going into US Fed meeting on 14-Jun-23, ECB meeting on 15-Jun-23 & BOJ meeting on 16-Jun-23.
Our strategy this week is to wait for better clarity as we expect increase in volatility ahead of event and on reaction to event. US Fed is expected to pause, post meeting press conference will be key.