SMI –17th September 2013 – Market View

Posted By : Kishore B.S

Hi Friends,

Yesterday markets were as volatile as it could get. Nifty gave up a 100 point gap up gain. The main trigger for this mayhem was the WPI data which came in a tad higher than expected at 6.1%.

As we have earlier said this week the markets are bound to be volatile. So, all the traders should be prepared for it. The market has become sell on rallies and buy on dips. If we see the charts very closely the markets have become mean reverting at 5850. So, Nifty goes up then comes back down or it goes down and then rebounds with 5850 as mean.

On the global front everyone is waiting for the Fed’s action. If it tapers the QE by $10 billion, the impact would be nullified as the markets have priced it in. Any tapering less than this would lead to a rally and anything more than this would lead to a sharp correction.

So, be cautious on your trades as markets will be news driven this week. There is no point predicting on technical basis as whether markets will go down or up as technicals won’t work when such a big news is going to be the major driver of sentiments.

Cheers!!

Team SMI

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