Rate hike on the cards

50 bps rate hikes is on the cards. Markets triggered selling pressure on back of hike in bank rates to control the rising inflation. Reality sector may again see some selling as the sector is going through its bad faze. New bookings are down nearly 30%. Investors are still holding on the price making it difficult for new buyers to step in. Prices have to correct as to get the new buyers.

Meanwhile in US, businesses ordered more aircraft, autos and computers in March, underscoring the resurgence of manufacturing this year. New jobless claims in the US fell last week, brightening the longer term outlook and signalling that lay-offs were slowing and employers may be ready to start hiring soon. First-time claims for unemployment benefits fell 5,000 to 382,000 in the week ending March 19, from a revised 387,000 the week before, according to the labour department. The fall was in line with economists’ forecasts and brought the less volatile four-week average down to 385,250, its lowest level since July 2008. The Federal Reserve signaled that it is in no rush to scale back its extensive support for the US economy and kept the interest rates unchanged at 0.0-0.25% and the discount rate at 0.75%.

In my last article I had given some reason to buy silver. But after making an all time high Silver corrected sharply on back of traders booking profits. The White metal fell almost to Rs.65000 but bounced back immediately to trade above Rs.70000 in the same week. If the silver corrects investors should not worry about their position. Investors can hold on to their position for a longer period also.

Indian markets after making a small Doji like pattern on the chart, corrected heavily. Nifty made a high of 5906 and low of 5706 but closed at 5749. Nifty find support at 5700 levels.

Last week this writer mentioned that Nifty will find resistance at 5900 and close above the same will take it to 6000 levels. But Nifty could close above the same and corrected to fall below 5800 within days. I had also mentioned that the Nifty can fell down to 5935 levels and it did.

On the charts Nifty made Double top and corrected. In the chart we can clearly see that the nifty faced resistance at 61.80% retracement levels. Nifty took support at its 200DMA after felling from its 20DMA. Nifty if closes below 5735 may fall till 5650 levels. Nifty took support at its 100 DMA. MACD has given negative divergence and the Nifty triggered selling pressure. Below 5705 Nifty will come down till 5635 levels. In the past also nifty had faced resistance at 5900 levels and support at 5700 levels. Either side movement will see a fast movement. Upside movement seems to be slightly difficult.

Last weeks call

Buy Bajaj Auto close above 1470 SL 1459. Made a high of 1500.

Sell Bhel below 2048 SL 2059. Made a low of 1975.

Buy Dlf above 253 SL 247. Did not trigger the price.

Buy Hdfc bank above 2417 SL 2405. Made a high of 2441 & triggered SL.

Buy Hdfc above 738 SL 731. Did not trigger the price.

Sell Pfc below 227 SL 228.50. Made a low of 220.50.

This weeks call

Sell Adani below 620 SL 624.

Sell Bharti Airtel below 377 SL 381.

Sell DLF below 219 SL 222.

Sell Federal Bank below 414 SL 418.

Sell IOB below 151 SL 152.50.

Sell Jai Prakash Ass with SL of 94.50.

Sell Lic housing below 217 SL 219.5.

Sell SBI below 2800 SL 2809.