RBI keeps repo rate un­changed

Money Times - - Front Page - By San­jay R. Bha­tia

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

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