Saturday, September 21, 2013

Weekly Review - 23.09.2013

Dear All,


RBI's new Governor Raghuram Rajan cut the MSF rate to 9.5%, the repo rate was hiked to 7.5%. CRR was left unchanged.


We are anti-inflation' is Rajan's unequivocal message to anyone who had doubts about his Chicago School credentials. And that's good for the economy in the long run.

Many factors may have contributed to the demand pull inflation, but the RBI does not control much of them. It may be the government's wasteful expenditure, or welfare expenditure. Rajan's signal is, if the government continues with its profligacy, it has to pay higher interest rates. Savers, essential for any investment led growth, cannot be punished anymore. We need savers more to fuel investment, than spenders.


"RBI move aims to inject a dose of reality check in the market expectations, and also gives a step ahead of the impending fuel price hike and Fed tapering," said Rajiv Pathak, Research Analyst at Dolat Capital Market.

"The increase in repo rate could have been avoided as industry is already reeling under pressures of high cost of capital and low availability in a tight liquidity situation." - Chandrajit Banerjee, CII Director General



Raghuram Rajan also said on Friday that , "the postponement of tapering is only that, a postponement." "We must create a bullet-proof national balance sheet," Rajan emphasised. Rajan said that while marginal standing facility (MSF) which was reduced by 75 bps, is the effective rate today, over a period of time the economy will return to repo rate being the effective one. "The caliberated withdrawal will help the financial system," he said.

"We have to look at inflation from a 6-12 months perspective. One particular inflation reading does not effect the stance on inflation," Rajan said. "Repo rate should be consistent with inflationary pressures," he added.

>>> NIFTY HOURLY CHART - UPDATED ON 19TH SEP - A DAY BEFORE RBI POLICY <<<

>>> Click the chart to see on full screen <<<



Yes, Alerted and said Nifty should fall. So Every one knows what happened. Raghuram Rajan surprised every one by raising CRR and market crashed. Now whats next ...???

>>> HAPPENED AND YET TO <<<

>>> Click the chart to see on full screen <<<



Yes IHS target almost achieved and logically bulls rally almost over. So I feel market should fall more in next week also. Lets see in detail how nifty moving on 5 mins charts also for getting more clues and ideas.

>>> NIFTY - 5 MINS CHART - AN ALTERNATIVE FOR BULLS <<<

>>> Click the chart to see on full screen <<<



Though IHS target is over, we had some more stream left for bulls on 5 mins chart. The last leg of up move is logically over only when it breaks important supports like 5933 and 5877. If these levels are not broken then assume that the fall is sub wave (iv) on 5th wave upmove. So if you ask me whats the target for upmove in this case, its 6150,6200 and 6280 on the upper side.

So a safe traders must watch the above levels before entering a trade.

>>> BLOCK BUSTER CHARTS OF THE WEEK <<<

>>> RANBAXY <<<


>>> Click the chart to see on full screen <<<



>>> ULTRATECH - As given on 17th Sep, 2013<<<
>>> Click the chart to see on full screen <<<



>>> HAPPENED AND YET TO <<<



>>> Click the chart to see on full screen <<<



>>> BHEL <<<


>>> Click the chart to see on full screen <<<




>>> PERFORMANCE <<<
>>> Click the image to see on full screen <<<