RBI policy, F&O expiry crucial events for markets next week
The market has stalled. This is evident from the fact that the market has formed the ‘Doji’ candlestick pattern on technical charts in the past 4 out of the 5 days this week.
This candlestick pattern on the daily chart generally occurs when the market sentiment is uncertain and incremental funds do not flow into the market.
As seen with Indian equities, the FIIs continue to pump additional funds, but the DIIs have been aggressive on the sell side.
The RBI monetary policy and derivative expiry in the next week are likely to be crucial from a trader’s perspective and can be trend-changing events.
Technically speaking, there is little change in the market structure with respect to the previous week. The negative divergence on the daily charts with regards to the Elliot oscillator and the RSI momentum indicator continues to exist.
The momentum oscillators on the weekly chart are also in the overbought zone. Taking clues from the channel pattern seen on the hourly chart and combining it with the current derivative data, we see that a fall below the 6100 mark can lead to a substantial increase in selling pressure.
For more visit: Business Standard
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