Sunday, August 28, 2016

Weekly Review - 29th August, 2016

Dear All,

The case for raising US interest rates has strengthened in recent months because of improvements in the labour market and expectations for moderate economic growth, Federal Reserve Chair Janet Yellen said on Friday.

Yellen did not indicate when the US central bank might raise rates, but her comments reinforced the view that such a move could come later this year. The Fed has policy meetings scheduled in September, November and December.

Speaking at a three-day international gathering of central bankers in Jackson Hole, Wyoming, Yellen said the “US economy was nearing the Federal Reserve’s statutory goals of maximum employment and price stability.”

“In light of the continued solid performance of the labour market and our outlook for economic activity and inflation, I believe the case for an increase in the federal funds rate has strengthened in recent months,” Yellen said in prepared remarks.

She added that the Fed still thinks future rate increases should be “gradual.”

The Fed raised rates in December, its first hike in nearly a decade, but it has held off further increases so far this year due to a global growth slowdown, financial market volatility and generally tepid US inflation data.

Investors currently see an 18% probability the Fed will raise rates at its September policy meeting and a 53% chance of an increase in December, according to CME Group’s FedWatch tool.

India’s 10-year sovereign notes completed their first weekly drop in three weeks as Urjit Patel’s appointment as the next Reserve Bank of India (RBI) governor dashed speculation that monetary policy will be eased aggressively.

Bonds had rallied since June after RBI governor Raghuram Rajan’s announcement that he will step down when his term ends in early September sparked speculation his successor will be more willing to lower policy rates. Patel’s elevation from deputy governor disappointed some investors because he had burnished his inflation-fighting credentials by advocating consumer-price targeting and the formation of an independent monetary policy panel.

“There is a bit of disappointment in the bond market after the government named Patel to head the central bank,” said Bhupesh Bameta, head of research for currencies and rates at Edelweiss Financial Services Ltd in Mumbai.

The yield on the 10-year debt rose three basis points this week, the biggest increase since 26 February, to 7.13% in Mumbai, according to data from the central bank’s trading system. It jumped six basis points on Monday after the government named Patel as Rajan’s successor over the weekend. It rose one basis point Friday.

Bonds had rallied after Rajan’s 18 June announcement that he will return to academia, pushing the benchmark 10-year yield to 7.08% on 11 August, the lowest since September 2009.

>>> Nifty Weekly Chart <<<

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Clear sign of bear visible on Weekly Chart. RSI broken down and Price unable to cross above 8720 for last 3 week. Caution advised.

>>> Nifty Daily Chart <<<

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Price must follow the RSI to break the trend or support line.

>>> Nifty Hourly Chart <<<

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Price inside a small range for last two and half month - must either breaks above or break below the channel to confirm the trend.

>>> Bank Nifty Daily Chart <<<

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Daily BN shows - 19150 is a good support.

>>> Bank Nifty - Hourly Chart <<<

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19130 and 19030 - Should hold for an UPmove. If breaks then Fall to start.

>>> AsianPaints - Posted on 18th Aug, 2016 <<<

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Above chart posted as a follow up on 18th Aug, 2016 - as a possible chances of correction and advised to hold short. See what happened.

>>> Asian Paints - Profit Booked Rs.20,400 <<<

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We have booked Profit near 1104 with Rs.20,400/- As per above chart, If price break again the trend line, Fall can again resume.

>>> HDFC - Hourly Chart <<<

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We have shorted - expecting a good correction.

>>> Performance till 26th August, 2016 <<<

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Above performance is not a Promise or guarantee for the given Profits or Loss. Performance given based on 1 lot at a time and clients Profit differ as per the margin availability and Number of Lots taken by them. We may or may not re-enter the Calls given here hit Stop Loss, as per market movement. The charts given above are just for educational purpose only and we don't recommend any Entry / Buy or Exit / Sell. Reader must taken their own decision or consult their qualified Analyst before making any decision