Posted By : Kishore B.S
The markets seem to have understood the importance of the political risks that is currently prevailing in the Indian subcontinent, and hence inspite of the factored rate cut of the 25 bps cut by RBI, the news of the DMK pulling out of the Govt rattled the markets harder than expected.
This news of the unstable Govt has made the markets tank by nearly 3% when the Global markets have been basking in the glory of new highs in the last 5 years.
The technical charts are indicating at current levels, that the picture looks gloomier if the 5650-5600 levels are broken, suggesting a downtrend to the levels of the 5200 which might happen if the elections are declared during this year itself.
But if the markets were to hold the 5700 levels and bounce above the 5840 then things might brighten up to rally to the 5900 once again as a relief rally during the Yearly results season.
Much can be said and written but it would be ideal to watch out cautiously for these levels before initiating any fresh calls……
(Inputs: Basket option Research bureau – Bangalore)