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Stock Market Daily Updates: 3 Sep 2020

Hence, trader needs to be cautious about on the direction of the market and long positions above 11606 points. The short-term trend of the Nifty future continues to be positive, but the chances of profit booking emerging at the higher levels remain strong

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Dear Trader…

The Indian stock market started trading with the modest decline. Telling the Supreme Court that the loan moratorium could be extended by the government at a time when the economic growth-GDP growth expected from April to June during the Corona epidemic lockdown could be discounted to the expected negative 23.9% negative factor and the Indian stock market was shaken by the implementation of new pledge and re-pledge margin norms by the Securities and Exchange Board of India (SEBI), the regulator of the capital market from September 1.

The Indian stock market rose for the second day in a row as IHS Market India's Manufacturing Procurement Managers Index (PMI) rose compared to July and the Supreme Court granted relief to telecom companies to pay AGR dues while hearing the AGR case.

Friends, although the monsoon has been very successful across the country and the number of corona virus infections has been on the rise, the economic activity in the country has also started growing along with Unlock-4 attracting foreign funds to Indian stock markets.

The Indian economy is expected to recover and the recovery is expected to accelerate in the coming days as the monsoon is successful. Of course, the growing tensions on the border between India and China and the current market boom in the overbought market do not match the economy. So caution is likely to be needed in the coming days as fund stocks are likely to see an index-based two-way slump.

As my view that markets are trying to digest the recent negatives and the rally indicated that the market had ignored India-China border tensions; however, we feel traders should continue with a cautious trade and prefer hedged bets. In the absence of any major event, the India-China border dispute and performance of world markets will continue to dictate the trend. the index seems to be consolidating in a range. 

Hence, trader needs to be cautious about on the direction of the market and long positions above 11606 points. The short-term trend of the Nifty future continues to be positive, but the chances of profit booking emerging at the higher levels remain strong, now a close above 11606 points could initiate a fresh leg of upswing while on the downside, a break below 11505 to 11488 points could fuel further selling pressure.

At the present level, volumes on the NSE fell below recent averages, probably hinting at the impact of the new margining system. While media, IT, metals, and auto indices did well, the PSU bank index ended marginally in the negative.

Dear Traders…. For the Trading Idea of…

Nifty Future opened @ 11578 as on 03.09.2020

For Intraday, Nifty Future has resistance at 11606 – 11616 Point; above which other resistance levels are at 11633 – 11660 Point with highly Volatile Trend.

Nifty Future has Downside support levels are at 11530 – 11505 Point; below11505 Point, other support levels are at 11488 – 11460 Point.

I am positive for the next bullish trend only above @ 00000 Point but be with the trend. Let the market decide further moves. As we are saying from many days, Buying is suggested in falls only...and it’s still a better strategy in the given Scenario

Regarding Long term positions, it is preferable to remain cautious now

If Nifty Future crosses @ 11633 Point, again then the upper side target is quite high and it may touch @ 11660 Point in the short term

Bank Nifty Future opened @ 23938 as on 03.09.2020

For Intraday, Bank Nifty Future has resistance at 24008 – 24088 Point; above which other resistance levels are at 24240 – 24303 Point with highly Volatile Trend,

Bank Nifty Future has Downside support levels are at 23880 – 23808 Point; below23808 Point, other support levels are at 23770 – 23730 Point.

I am positive for the next bullish trend only above @ 24303 Point but be with the trend. Let the market decide further moves. As we are saying from many days, Buying is suggested in falls only...and it’s still a better strategy in the given Scenario...!!!

Regarding Long term positions, it is preferable to remain cautious now.

If Bank Nifty Future crosses @ 24303 Point, again then the upper side target is quite high and it may touch @ 24373 Point in the short term.

Trading Idea for the derivative stocks….

DIVIS LAB FO @ RS 3308

Positive Trend @ Rs 3308 / 3288 with Stop loss of Rs @ 3270 for the target near @ Rs 3333 - 3350 in short term

INDIGO FO @ RS 1270

Positive Trend @ Rs 1270 / 1260 with Stop loss of Rs @ 1250 for the target near @ Rs 1288 - 1303 in short term

HDFC BANK FO @ RS 1135

Positive Trend @ Rs 1135 / 1122 with Stop loss of Rs @ 1108 for the target near @ Rs 1147 - 1160 in short term

LUPIN FO @ RS 962

Positive Trend @ Rs 962 / 944 with Stop loss of Rs @ 936 for the target near @ Rs 988 - 990 in short term

ICICI BANK FO @ RS 395

Negative Trend @ Rs 395 / 408 with Stop loss of Rs @ 414 for the target near @ Rs 386 – 380 in short term

TECH MAHINDRA FO @ RS 742

Negative Trend @ Rs 742 / 755 with Stop loss of Rs @ 763 for the target near @ Rs 730 – 719 in short term

TATA STEEL FO @ RS 444

Negative Trend @ Rs 444 / 455 with Stop loss of Rs @ 460 for the target near @ Rs 430 – 424 in short term

RELIANCE FO @ RS 2144

Negative Trend @ Rs 2144 / 2160 with Stop loss of Rs @ 2180 for the target near @ Rs 2121 – 2108 in short term.

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Nikhil Bhatt | Research Analyst - SEBI

The author is a well established entrepreneur having a more than 16 years of experience in the field of stock market and financial management.

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