GLOBAL EQUITY INDICES
Global markets entered a bear cycle in this week. Anytime, a sharp fall is anticipated – trade with caution. This fall will continue with ups and downs until June 2016. The most bearish period is 18th to 20th May 2016. This shall continue for next week.
Monday and Tuesday shall be zigzag in terms of the trend (followed by a bit of recovery). It is advisable to maintain “sell on rise” strategy for key indices.
This week, S&P500 FUT has potentials to move up to 2065 on the higher side and may drop to 2020-2000 on the lower side. You are advised to book profit in 50% position around 2040-2044 and add short around 2060-2065 for target 2020-2000.
By June 2016, S&P500 FUT may drop to 1950. We shouldn’t be surprised even if it drops below 1850.
Trend in bullion shall be supportive till 18th May 2016. Gold has potentials to move up to 1295-1305. If it crosses 1308 then it may escalate to 1320 or above.
On the other hand, Silver has potentials to move up to 17.60. If it sustains 17.70 then it may escalate up-to 18.00.
On 18th May 2016, you must book profit in long position of bullion and around US closing hour, you can build short position of Gold and Silver.
19th to 26th May shall be a bearish phase for precious metals. From 27th, it shall trade positive.
Crude oil shall be supportive for 16th and 17th May 2016. If 47.60 is crossed then it may go up to 48.00-48.50.
After 18th May’s mid-session, sharp fall is anticipated, which may continue for next week. By this weekend, Crude may drop to 40 or lower.
However, on Friday crude oil is anticipated to trade around 40.00.
A bottom is expected to be made around 25th (it may correct to 36).
Dollar index shall behave negative till 18th’s mid-US session. And then trend shall move in positive direction. The next week shall also be supportive for dollar index.
On the lower side, it may correct to 94.00 and on the higher side, it may move up to 95.50-96.00.
US TREASURY BONDS
You are advised to book 50% position in bonds around 1.70 and 2.55. Trend seems to be positive for bonds in this week. You may long bonds at lower levels.
INDIAN STOCK MARKET
Indian market shall trade in zigzag pattern for this week. 18th to 20th, a sharp fall is expected. On the higher side, Nifty Fut may go up to 7880 while Bank Nifty may go up to 16900. On the lower side, Nifty Fut may drop to 7650 and below while Bank Nifty may drop to 16100.
In the next week, a sharp fall is anticipated. In next week, Nifty Fut can drop to 7500 or below while Bank Nifty can drop to 15500.
– NIFTY MAY FUT: 7850-7750
– BANK NIFTY FUT: 16900-16500
BUY ON DIPS:
– SKS MICRO
– BAJAJ FINANCE
– RELIANCE CAPITAL
– ARVIND MILLS
– CENTURY TEXTILES
– HERO HONDA
– TATA MOTORS
– JUBILANT FOOD
– DR REDDY
SELL ON RISE:
– BANK OF BARODA
– TATA STEEL
– UNION BANK
– ICICI BANK
– RELIANCE INFRA