Week starting from 28th October
Coming week of 28th Oct 2013 is going to be very important. There are multiple sceanarios playing out in market around 3 major events. First is RBI meet on 29th. Market is expecting 25bps hike in repo rate. There may be 25bps cut in MSF alongwith it. Repo rate hike is already priced in by market. Question is whether with MSF cut or without cut. But MSF is not that important compare to hike in repo. If for some reason RBI does not hike rate at all then market will like that very much. Similalrly even after initial knee-jerk reaction market will absorb repo rate hike if it remains at 25 bps and eventually will go up. But if RBI gets aggressive on inflation front and hikes it 50bps then there will be collapse in market. Possibility of this is very thin. So my guess is that we will end up on positive side on RBI day.
Next in line is Fed meet. Fed's policy statement will not effect 31st trading much as that will be expiry day. But fed may surprise market by having very dowish commentary and giving some fuel to further QE increase. This has been a discussion among few analyst in US markets. As of now everybody in US is expecting that tapering is off the table till March. Fed may suggest that there are no near term indication of taper which may indicate till June 2014 end. This will be shot in the arm for bulls.
And last but very important our new series on 1st Nov on the eve of diwali which I am expecting to start with bang. Diwali can be bad only if RBI hikes repo by 50bps which is very unlikely.
Now how do I position myself for coming week. I am going to buy during Monday trading or Tuesday morning before policy. This will enable me to make some good money. I do not think Nifty will break 6100 on Monday. That will be first indication that this market is in strong hands. My concern is more on tuesday morning opening. I hope that Apple does not disappoint US markets which can give some headwinds on Tuesday morning for Nifty. If everything goes as per script I am hoping for expiry around 6300 in this series and all time high on Friday 1st November.
Coming week of 28th Oct 2013 is going to be very important. There are multiple sceanarios playing out in market around 3 major events. First is RBI meet on 29th. Market is expecting 25bps hike in repo rate. There may be 25bps cut in MSF alongwith it. Repo rate hike is already priced in by market. Question is whether with MSF cut or without cut. But MSF is not that important compare to hike in repo. If for some reason RBI does not hike rate at all then market will like that very much. Similalrly even after initial knee-jerk reaction market will absorb repo rate hike if it remains at 25 bps and eventually will go up. But if RBI gets aggressive on inflation front and hikes it 50bps then there will be collapse in market. Possibility of this is very thin. So my guess is that we will end up on positive side on RBI day.
Next in line is Fed meet. Fed's policy statement will not effect 31st trading much as that will be expiry day. But fed may surprise market by having very dowish commentary and giving some fuel to further QE increase. This has been a discussion among few analyst in US markets. As of now everybody in US is expecting that tapering is off the table till March. Fed may suggest that there are no near term indication of taper which may indicate till June 2014 end. This will be shot in the arm for bulls.
And last but very important our new series on 1st Nov on the eve of diwali which I am expecting to start with bang. Diwali can be bad only if RBI hikes repo by 50bps which is very unlikely.
Now how do I position myself for coming week. I am going to buy during Monday trading or Tuesday morning before policy. This will enable me to make some good money. I do not think Nifty will break 6100 on Monday. That will be first indication that this market is in strong hands. My concern is more on tuesday morning opening. I hope that Apple does not disappoint US markets which can give some headwinds on Tuesday morning for Nifty. If everything goes as per script I am hoping for expiry around 6300 in this series and all time high on Friday 1st November.
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