RBI keeps repo rate unchanged
The carnage continued on the domestic bourses last week as the Nifty traded below its 200-day SMA, which is its long-term average. The markets witnessed sustained selling pressure even after the government took over the IL&FS group and superseded the management. The marginal cut in excise duty on petrol and diesel did not help as oil marketing companies were asked to reduce prices. The FIIs remained big sellers in the cash segment but remained net buyers in the derivatives segment. However, the DIIs continued to support the markets at the lower levels and remained net buyers. The breadth of the market remained negative amidst low volumes. On the global front, crude oil prices moved higher on a fall in production due to ban on Iran supplies. On the domestic front, the rupee breached the 74 mark against the US dollar and the RBI surprisingly maintained a status quo in repo rate. Technically, the prevailing negative technical conditions weighed on the market sentiment. The Stochastic, MACD, KST and RSI are all placed below their respective averages on the daily and weekly charts. The Nifty is placed below its 50-day SMA, 100day SMA and 200-day SMA. These negative technical conditions could lead to intermediate bouts of selling pressure, especially at the higher levels.
The prevailing positive technical conditions, however, still hold good. The Stochastic and RSI are placed in the oversold zone on the daily and weekly charts. Further, the Nifty’s 50-day SMA is placed above its 100-day SMA and 200-day SMA and its 100-day SMA is placed above its 200-day SMA, indicating a ‘golden cross’ breakout. These positive technical conditions could lead to a short covering and selective buying support at the lower levels.
The -DI line is placed above the +DI line and the ADX line. It is placed above 45, which indicates that the