RBI governor quits and BREXIT postponed

Global Stock Indices

In the previous session, US market behaved highly volatile. DOW Dec contract made a low of 23900 while S&P500 made a low of 2583 and NASDAQ made a low of 6542. These lows shouldn’t be breached for now. Uncertainty will continue in market for today. Around 2605 and 23980, we asked you to long S&P500 and DOW along with NASDAQ @ 6560. We are also long in RUSSELL @ 1432.

50% profit booking has been advised in S&P500 @ 2636, DOW @ 24390, NASDAQ @ 6670 & RUSSELL @ 1442.

If market corrects again, add long position in indices at lower level and hold existing long position.

Brexit deal will be re-negotiated.

Precious Metals

It is advised to hold 50% long position in precious metals (Gold and Silver). Around 1240-1242 and 14.40, add Gold and Silver.

In a day or two, it is expected to move up.

CRUDE OIL

Hold long in crude with S/L 50.00.

NATURAL GAS

Hold long in NG with S/L 4.40 (closing basis) for target 4.65-4.75.

CURRENCIES

EURO (EUR/USD)

EUR/USD will cross 1.1500. Hold long position in EUR/USD. Add long in EUR/USD at lower level. We had a buy signal on EUR/USD at 1.1360 yesterday.

POUND (GBP/USD)

A considerable uptrend will be visible in GBP/USD. It will cross 1.2800.

YEN (USD/JPY)

Short USD/JPY @ 113.00-113.20 for target 112.20.

INDIAN RUPEE (USD/INR)

After the RBI governor’s resignation, USD/INR made a high of 72.80. In the previous letter, we asked you to hold long in USD/INR for 72.50. Positional traders are advised to book 50% profit @ 72.30-72.50 and hold remaining position with S/L 71.80. Day traders may book full profit.

DOLLAR INDEX

In the previous session, we asked you to short dollar index @ 97.08. Hold short for target 96.60.

US 30 Year T-Bond:
Yesterday, US 30 Y T-Bond triggered 144. It is advised to book 50% profit in US 30 Y T-Bond @ 144.

Yield:

Book 50% profit in short at current level (US 30 Y YIELD- 3.11 & US 10 Y YIELD- 2.84).

INDIAN STOCK MARKET

The RBI governor Urjit Patel resigned with immediate effect last evening. This will provoke a sharp selling in bank nifty as well as banking stocks and Nifty Index. It will raise concerns amongst foreign institutions and lead to a selloff.

Since last week, we have been regularly predicting that NIFTY may drop down to 10200 or below while Bank Nifty may drop down to 25000. Today, the result of elections across five states are due which can also severely affect the market in terms of volatility.

It is advised to wait for tomorrow to enter into buying position.

Cover short position in index and stocks at lower levels today.

Yesterday, we asked you to short NIFTY, BANK NIFTY, SBI, HINDALCO, DLF. Book profit in short position of these stocks.

Avoid long positions today.

Intraday perspective:

As per astrology, gap down opening is indicated. With heavy volatility, market will be downward till 13.00 HRS.  From 11.00 to 13.00 HRS, considerable fall is possible. Around 13.00 to 14.00 HRS, a recovery is possible. After 14.00 HRS, uncertain to bearish trend is seen.