16th March 2022 Pre Market


Image courtesy: quotefancy.com

Global Market Cue

  1. In regular US trading hours on Tuesday, “the S&P 500 rose 2.1%, the Dow Jones Industrial Average rose 1.8%, or 599 points, the Nasdaq Composite gained 2.9%”. During Asian markets hours US future are down ~.25%
  2. Oil Price are below $100 and holding amidst signals of resumption of talks on Iran nuclear deal and also possibility of diplomatic resolution for the ongoing Russian invasion, paving the way for more oil supply to come into the market.
  3. Fed reserve meeting has started, expectation is .25% increase in interest rate. Fed commentary on Inflation and growth will be keenly observed, any hawkish stand on future interest rate high might be adverse for extremely volatile market.
  4. China lock down continue to expand and is a risk for Global supply chain.
  5. US VIX is below 30. Yesterday dropped more than 5%

Commodity Market Cue

  1. Crude oil prices are below $100 on effort of diplomatic negotiation to reduce impact of supply chain disruption due to Russia Ukraine War. Other commodity prices have also started easing.
CommodityPriceDay% changeWeeklyMonthlyYearly
Crude Oil97.23.71.75%-10.53%8.1%50.54%
Natural Gas4.63400.0661.44%2.52%4.74%83.54%
Gold1920.592.82%0.14%-3.51%1.28%10.16%
Silver24.9090.0560.20%-3.02%4.81%-5.24%
source: tradingeconomics.com

Uncertainties & VIX

  1. Federal Reserve Policy meeting out come. 0.25% rate hike seem to be factored in to the price.
  2. Russia and Ukraine war, disruption of supply chain.
  3. Intensifying lockdowns in China introduce risks to Global supply chain, has helped ease oil price due to concern of global oil demand dropping.
VIXDayChange%
India VIX26.734.10%
US VIX29.84-6.04%
source: tradingview.com

India Benchmark Indices review

Nifty50:

  1. After 5 consecutive days of rally, yesterday saw correction in market around crucial zone. Market closed at 16648. Yesterdays low will be first support, failing which 16450 level will be tested, failing which Nifty will move towards 15400 level
  2. Daily and Weekly RSI around ~45. Monthly RSI continues to be above 60
  3. Support: 16395 is the immediate support and failing which 15400 range will be good support
  4. Resistance: 17150 could be immediate upside resistance

Both Brent and U.S. crude futures benchmarks settled below $100 per barrel for the first time since late February. Since reaching 14-year highs on March 7, Brent has slid nearly $40 and WTI more than $30. Trading has been extremely volatile since Russia invaded Ukraine more than two weeks ago.

Moneycontrol

Bank Nifty:

  1. Bank Nifty droped 389 points and is trading at 34930. Short covering rally is seen in Bank nifty as given way to short build up.
  2. Daily RSI is at 43.41 RSI and Week RSI is at 42.44, bouncing off from 40.
  3. Monthly RSI is weak has breached is at 55, coming from top.
  4. Support: 34290 is the immediate support and failing which 32200 range will be good support.
  5. Resistance: Currently in resistance zone. Near term test will be 200 MA 36200, will it take out?

Summary

Today likely to be a gap up, SGX nifty is up 230 points. Point is will it sustain and build on the gap up or will it fizzle out we have seen happening in recent days. Geo political tension, Fed commentary, raising case of Covid in china all are be watched out for. As for indices, I will be looking for buy opportunity on long side. Also hoping for my metal portfolio pays off.

Good day and good trading, Sindbad off!

Research sites:

tradingview, investing.com. moneycontrol.com, tradingeconomics.com


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