Banknifty Archives - Equichain Wealth Advisors

Last week – review

Indices this week ended with cut of under 1% on major indices and Banknifty loss by 1.52%. RBI MPC meeting outcome on 10-Aug-23 – RBI kept repo rate unchanged at 6.50% and continue its stance of “Withdrawal of Accommodation” with 5:1. Indices seen consolidating for 2nd straight week.

Technical Insight

• Nifty on daily chart indicate further weakness. Nifty @ 19160 could act as key support level and Nifty below 19160 could test 18646.

• Banknifty RSI & RSI average indicate further weakness. Banknifty could test 43541 and further downside possible.

Approach on Technical: Indices on daily chart are seeing some kind of weakness, further consolidation seems likely in the month of August 2023.

Nifty range of this week looks like 19160 to 19674, Nifty below 19160 could indicate further weakness towards 18646. Nifty above 19674 could be considered as trend reversal as bullish. Banknifty closed below 44578 could test 43541 level this week.

Fundamental Insight

1) Bank Credit Growth to MSMEs Decelerates in June Quarter: RBI Data
2) Cabinet Approves Rs 1.39-Lakh Crore Plan For Rural Broadband
3) SBI Seeks Buyers For Its Rs 96,000 Crore Bad Loans
4) Credit Card Default Rises To Rs 4,072 Crore In FY23

Equichain Wealth Advisors: Market View & Strategy

Global cues continue to remain mix as market consolidated this week. With Q1FY24 result near to its end, we see further consolidation and correction from current level would be healthy after market rally seen since last April 2023.

We see current rally as opportunity to reduce exposure and keep exposure around 70% to 85%. After recent run-up seen in pharma stocks, some sign of fatigue seen.

Click on the attachment to read the full report:

12-Aug-23 Fundamental & Technical Insight.pdf

Last week – review

Going into trade last week, we had maintained cautious view with allocation to be kept around 70% to 85%. Market momentum seems to be very strong as tech stock which came out with Q1FY24 result, stock prices reacted positively despite weak numbers.

Technical Insight

Nifty RSI @ 72.51 & RSI average @ 70.30. Nifty closing @ 19564.50 is highest closing recorded in this rally. Nifty next target / resistance comes at 19716 & support level comes at 19371 & 19232.

Banknifty RSI @ 58.15 & RSI average @ 59.06. Banknifty closing on Friday’s closing at 44819, immediate resistance at 45110 & support level comes at 44228.

Approach on Technical: Indices rally looks a bit over-stretched. Momentum on Nifty is very strong and indicate that outperformance may continue over Banknifty in near term.

Our strategy would focus on any long trade would be short term in nature, we continue to remain cautious after huge rally on indices without any major correction. Nifty @ 19232 & Banknifty @ 44773 would act as strong support level. Once this level is broken, can expect further downside.

Fundamental Insight

1) India’s Trade Deficit Narrows To $20.1 Billion In June As Exports, Imports Decline
2) India’s WPI Deflation Widens To Near Eight-Year Low In June
3) HDFC Shareholders Allotted Over 311 Crore Shares Of HDFC Bank

Equichain Wealth: Market View & Strategy

We see current rally and momentum very strong as reaction to weak result from IT stocks supported by positive commentary from management that worst is over. We are already at lower end of the exposure and current rally would stretch valuation a bit more. HDFCBANK will come out with result on 17-Jul-23, which will provide cues on who banking stocks would react? Loan growth and advance remain high at average of 15%.

We are comfortable with our current exposure in equity around 70% to 85% and continue to find opportunity of stock rotation and maintain allocation level at current level. We would review IT stocks as worst may be behind us and inflation cooling off in US will provide much needed boost for tech spending helping IT stocks.

Click on the attachment to read the full report:

15-Jul-23 Fundamental & Technical Insight.pdf