Negative News From the Finance Sector can be a trigger for a bigger correction before the budget session: CapitalAim

Mr. Romesh Tiwari, Head of Research, CapitalAim

The Benchmark Nifty50 Index opened the week on a positive note and tested the levels of 12000 on Tuesday but did not sustain above this level for the week. On Friday, Benchmark Nifty50 opened on a negative note and remained bearish for the day to test the levels of 11797.70 on the daily chart. The Index has not been able to sustain above 12000 levels and for the entire week, it traded in the range between 12000 levels on the higher side and 11800 levels at the lower side.

For the next week, Upside looks limited for Nifty and it may find difficult to close over 12,000, where the supply is expected. On the other hand, downside movement will be swift, and Nifty can soon touch 11,720 levels and close below that may take it to 11,600 levels. On the technical chart, RSI is looking weak on daily charts and now placed at 51.87 levels. MACD on the same chart has shown a downward crossover. Negative news flow from the finance sector on loan repayment is dampening the investor's sentiments which can be a trigger for a bigger correction before the budget session.

This week, in the Indian market, there would be no important data. On the international front, there would be NY Empire State Manufacturing Index (Jun) on Monday, data of Building Permits (May) & Housing Starts (May) on Tuesday, FOMC Economic Projections, FOMC Statement and Federal Funds Rate on Wednesday & on Thursday, there would be FOMC Press Conference and data of Existing Home Sales (May) would be released on Friday.

Source : Equity Bulls

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