Next week F&O expiry is due, expecting market to remain traded on volatile zone : Amrapali Aadya

Mr. Abnish Kumar Sudhanshu, Director & Research Head, Amrapali Aadya Trading & Investments:

Week began on positive note on account of progress of monsoons and the country's preparedness for GST implementation from July 01. Rally further intensified after Narendra Modi-led NDA government named Ram Nath Kovind, the Governor of Bihar, as the party's official nominee for the post of the President of India. However, after moving in the week market turned nervous on account of approaching F&O expiry as well as implementation of one of the biggest reform in India i.e. GST. We expect some disruption in the initial days in economy due to implementation of 'one nation one tax', knowing the fact that stock markets run on the forward earning, we assume it is factoring that disruption gradually. Next week F&O expiry is due, so we are expecting market to remain traded on volatile zone. Lack of big trigger in the coming week is also likely to keep Nifty to hovering in the range of 9485-9700. Benchmark indices are likely to dance to the tune of GST preparedness as well as monsoon. Hence, we expect market to remain below 9700 until the GST doesn't turn reality. One GST turn reality, indices will take cues from the same. We advise investor to make their investments in airlines, textile, transport services, FMCG & auto sectors. One can look for HUL, Maruti, GATI, Interglobe and ZEE are advisable counters for the investment.

Benchmark Nifty witnessed heavy profit taking on last trading session of the week and closed with slightly more than half-a-percent intraday losses. Although market saw a gap-up opening but persisted selling pressure took the market breadth into negative territory and slipped for the second consecutive week, still failed to its previous week's lows which is likely to provide strong support for the market.

Market has also closed below 20DMA in almost a month and reached around 9560 levels which seems to be the stronger area for the market and a close below could prove severe at the present levels and more selling pressure could be expected thereafter.

Short term momentum indicators have now turned gradually negative and bears can be seen taking charge for the market steadily, a sell on rally would be suggested to the traders at these levels.

Source : Equity Bulls

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