Nifty: RBI rate cut and markets correct the saga continues!

RBI reduced repo rate by 25 bps and despite of that Nifty corrected today. We have observed that on most of the occasions rate cut is followed by correction in equity markets and today was no different.

There was high volatility during the day but index closed lower by 45 points.  Look at the below chart of Nifty 60 mins given in the morning equity research report

Nifty 60 mins chart: published in morning on 4^th April 2019

Following was mentioned today morning before markets opened:

 
On the hourly chart we have shown the ADX indicator which can be seen going flat for quite some time indicating towards the possibility of some sideways move ,in the sessions to come. The prices seem to have broken the 15 period EMA and can be seen making a move towards the 75 period EMA, thus we can expect the level of 11569 to act as a support going ahead. A break below that level might intensify the selling pressure. 

In short, the trend for Nifty might remain sideways with the immediate resistance placed at 11760 and the support placed at 11550. We could consider the upmove to be intact as long as the level of 11550 is held intact. It is now time to be cautious and today’s closing is going to be important. If RBI cuts repo rates and still the index closes lower that will be a bearish signal. Also we have observed on many occasions rate cut is followed by negative close. Let us see if RBI governor goes with the majority who are expecting 25bps cut or maintains a neutral stand. Market movement will decide the news headline post the RBI policy and it is not the other way around! BANG ON! 

Happened: Despite of rate cut Nifty closed lower and is flirting around the important support near 11560. So what is next from here? 

Get access to the daily equity research report – The Financial Waves short term update and get indepth analysis on Nifty, stocks, Bank Nifty with complete Elliott wave counts and other technical analysis method. Get access here 

Attend the Most advanced training on Technical analysis – Forecast the markets like never before using the tools of Neo wave, Time cycles and Ichimoku Cloud. Here are more details