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Below is the Views On Daily Market Wrap by Mr. Sameet Chavan, Chief Analyst-Technical and Derivatives, Angel Broking
“During the previous week, our markets showed tremendous resilience and in the process, managed to give smart recovery of more than 15% from the lows of 7511.10. Things started to look brighter but clearly at present we are in an abnormal phase and in such kind of health crisis, it would be difficult for markets to give extended relief moves. This week, the proceedings started with a strong cut on Monday and despite some pull back on the following session, markets once again resumed it’s downward trajectory. Eventually, the truncated week ended with nearly seven percent cut from the previous weekly close.
As we all know, markets are clearly driven by fear and sentiments, and till the time, things with respect to coronavirus pandemic does not subside, the pain is likely to stay in the market. Traders are advised not to create aggressive bets especially leveraged positions in such kind of environment. This week, the INDIA VIX cooled off considerably from 12-year high, which is the only sign of relief; because it indicates a possibility of volatility reducing and thereby shrinking the overall range in the market. It would be important to see how things pan out over the weekend with respect to coronavirus.
As far as levels are concerned, 8000 followed by 7800 would be seen as immediate supports; whereas on the higher side, if market has to see some relief, the Nifty needs to surpass 8300-8400 convincingly. In the recent past, financial stocks have been facing terrible sell off and this week too, we saw tremendous underperformance from this space. Moreover, it would be unfair not to mention the stupendous rally in Pharma stocks on the last day of the week. It has been the safe haven space for traders/ investors in the recent meltdown and now it increases the possibility of the multi-year pain ending for this basket.”
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