The Pulwama attack on the CRPF convoy created a new sentiment towards downside in Nifty futures on concern over the government’s hawkish stance.
The market is bracing for yet another volatile week of trading as investors closely look at the government response to the terror attack and the movement of crude oil and rupee as well as the global markets, especially when the S&P500 is flirting with its 200-day moving average (DMA).
Last week, the Sensex lost 737 points, or 2.02 per cent, on closing at 35,808 on Friday while Nifty50 dropped 219 points, or 2 per cent to 10,724.
Technical analysts predict a bearish trend. According to them, a bearish candlestick formation on weekly charts is seen, while a Hammer pattern on the daily chart is now sending mixed signals for both bulls and bears, pointing to no major directional trend.
“We see this as a trading range for markets and market may see oscillating between the range of 10600-10900. This implies the bulls may utilise lower levels while bears may instill fear at higher levels,” Mustafa Nadeem, CEO at Epic Research, said.
Last week Nifty futures showed a downside momentum. The Pulwama attack on the CRPF convoy created a new sentiment towards downside in Nifty futures on concern over the government’s hawkish stance.
“The market is also looking for a trade deal between China & US which is extended by Mr. Trump for more 60 days. This deal also creates uncertainty in the markets,” Debabrata Bhattacharjee, Head of Research at CapitalAim, said.
“The Nifty50 has a support zone at around 10600 to 10500, which is a multi-day support from November 2018. If this range breaks we will hit 10200 in the very short-term,” he added,