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Stock Market Daily Updates: 7 Aug 2020

Market trends are volatile but the bulls managed to retain their hold on every deep to buy stock specific. It is critical for the index to sustain above 11272 points in the next trading session to retain positive bias as the breach of said level can attract selling pressure on intraday basis….

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Dear Trader…

Trading in Indian stocks began on the fifth day of the week ahead of the Reserve Bank of India's lending policy review, which is expected to boost the economy in the coming days on the back of positive rains across the country.

The repo rate was not changed during the three-day meeting of the Reserve Bank's monetary policy review. the RBI governor Shaktikant Das said the aggressive stance on monetary policy will continue as long as it is needed. We are working hard to accelerate growth. We try to minimize the impact of corona. In addition, we are also looking at the inflation rate.

On GDP growth, there was a three-quarter decline before FY2019’20.The growth rate will remain negative for the entire financial year. However, no statement has yet been made as to how long it could last. In addition, the RBI governor said that the country's economy is now backing on track after the Corona strike. The rural economy is recovering due to good yields. The repo rate of the Reserve Bank was cut by a total of 1.15%. Last year, after February 2016, the repo rate has been cut by 2.50%.

With regard to the commodity sector, the rise in gold and silver was fueled by the announcement of renewed stimulus in many countries of the world, including the US. Gold has seen new record prices globally and domestically, while silver has also moved closer to an all-time high.

Comex Gold hit a new record high of 2069 dollar in the global market. The United States and other countries are preparing to release new stimulus, which has led to a surge in the supply of paper currency and gold.

MCX Gold is expected to trade positively with support placed at Rs 55500 level and intermediate support at Rs 55300 level, we advised to buy on dips targeting higher resistance at Rs 56300-56500 zone.

Friends, the US government bond yield curve continues to steepen, extending support to the bullion. The talks regarding the new coronavirus relief bill continue, as we head towards the end of week deadline set by the negotiators.

US private payrolls growth slowed sharply in July, pointing to a loss of momentum in the labor market and overall economic recovery as new COVID-19 infections spread across the country, which also hints at a possible weaker non-farm payroll data expected to be released today.

India VIX fell by 1.78 percent to 23.15 levels. Decline in VIX from its recent bounce of 25.69 suggests that the bulls are using any decline as a buying opportunity and the overall trend could remain bullish.

Market trends are volatile but the bulls managed to retain their hold on every deep to buy stock specific. It is critical for the index to sustain above 11303 points in the next trading session to retain positive bias as the breach of said level can attract selling pressure on an intraday basis, 

Nifty future need to close above 11303 points for the uptrend to continue. If it happens; it will trigger a rally next week that will take the markets to 11373 to 11404 points. The support continues to remain around 11008 points, which if broken, can slip to 10808.

Nifty Future opened @ 11161 as on 07.08.2020

For Intraday, Nifty Future has resistance at 11188 – 11202 Point; above which other resistance levels are at 11230 – 11272 Point with highly Volatile Trend,

Nifty Future has Downside support levels are at 11130 – 11101 Point; below 11101 Point, other support levels are at 11088 – 11008 Point.

I am positive for the next bullish trend only above @ 11202 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 @ 11202 Point, again then the upper side target is quite high and it may touch @ 11330 Point in the short term 

Bank Nifty Future opened @ 21600 as on 07.08.2020

For Intraday, Bank Nifty Future has resistance at 21676 – 21707 Point; above which other resistance levels are at 21777 – 21808 Point with highly Volatile Trend,

Bank Nifty Future has Downside support levels are at 21474 – 21404 Point; below 21404 Point, other support levels are at 21363 – 21303 Point.

I am positive for the next bullish trend only above @ 21808 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 @ 21808 Point, again then the upper side target is quite high and it may touch @ 22008 Point in the short term

Prediction on Stock specific Movement as on 07.08.2020

DIVIS LAB FO @ RS 2744

Positive Trend @ Rs 2744 / 2727 with Stop loss of Rs @ 2707 for the target near @ Rs 2770 - 2788 in short term 

ACC LTD FO @ RS 1416

Positive Trend @ Rs 1416 / 1404 with Stop loss of Rs @ 1390 for the target near @ Rs 1434 - 1440 in short term

GRASIM FO @ RS 631

Positive Trend @ Rs 631 / 616 with Stop loss of Rs @ 606 for the target near @ Rs 646 - 650 in short term 

BHARAT PETRO FO @ RS 414

Positive Trend @ Rs 414 / 404 with Stop loss of Rs @ 393 for the target near @ Rs 433 - 440 in short term 

MUTHOOT FINANCE FO @ RS 1219

Negative Trend @ Rs 1219 / 1233 with Stop loss of Rs @ 1247 for the target near @ Rs 1203 – 1190 in short term.

HDFC BANK FO @ RS 1031

Negative Trend @ Rs 1031 / 1044 with Stop loss of Rs @ 1053 for the target near @ Rs 1019 – 1008 in short term.

INFOSYS FO @ RS 969

Negative Trend @ Rs 969 / 988 with Stop loss of Rs @ 993 for the target near @ Rs 947 – 940 in short term 

INDIGO FO @ RS 946

Negative Trend @ Rs 946 / 960 with Stop loss of Rs @ 968 for the target near @ Rs 933 – 919 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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