NIFTY and GLOBAL FACTORS

NIFTY

Nifty has made a bearish gravestone doji on weekly candlestick charts. This is also coupled with a massive open interest build up. Although confirmation is required on weekly charts and the fortnightly and multi-period charts have yet to form an indication of bearishness, the above two factors are indicative enough of the bearishness of Nifty. The fall may be gradual or precipitous with odds heavily favouring the latter.

GLOBAL FACTORS

A couple of other factors also weighed heavily on the Dow and Dax.

European Central Bank did not announce a fresh QE while retaining the rates to be the same on Thursday, Sep 8, 2016. Personally, on hearing the chairperson of ECB speak during the live telecast, I could not feel comfort in his voice though his speech attempted to give a comfort to the financial markets.

On Friday, German exports and imports data (month on month) for July ’16 indicated a drop of 2.6% and 0.7% respectively, which is a significant drop.

Another news which got unnoticed/ ignored during the last week (Monday) was a drop in the US ISM non-manufacturing PMI to 51.4 against 55.5 reported for the previous month. This is indicative of a slow down in growth. A figure below 50 is indicative of contraction in the economy.

On global front, Dow had a near 400 points shave on the last trading day of the week gone by.

CONTACT

The author can be contacted at: riskadvisory@outlook.com

DISCLAIMER:

These extracts from my trading books are for educational purposes only. Any advice contained therein is provided for the general information of readers and does not have regard to any particular person's investment objectives, financial situation or needs and must not be construed as advice to buy, hold and sell or otherwise deal in any kind of commodities, currencies, securities or other investments. Accordingly, no reader should act on the basis of any information contained therein without first having consulted a suitably qualified financial advisor.