NIFTY OUTLOOK & FREE NIFTY & BANKNIFTY TIPS FOR 16 MARCH 2016

“BUY NIFTY ABOVE 7455 TGT 7485/7545 SL 7410”

The Sensex posted its biggest drop in three weeks and Nifty settled below its crucial psychological level of 7,500 on the back of weak global cues. Investors maintained a cautious approach ahead of the two-day meeting of the US Federal Reserve’s Federal Open Market Committee that begins on Tuesday. Markets came under selling pressure after the Bank of Japan refrained from introducing new stimulus measures at its latest policy meeting. The Japanese central bank issued a warning on inflation expectations and offered a more negative view of the country’s economy. Investors now look forward to the Fed meeting, wherein although it is largely expected to hold raising rates, its comments on economic outlook and inflation would be closely watched.

The Sensex after opening a shade higher, advanced to touch a high of 24840 at the outset before profit- booking in recent gainers took hold, which pulled it down to a low of 24517 and settled at 24551, showing a loss of 253 points. The gauge had gained 180 points in the previous two sessions. The Nifty broke below the crucial 7500 level and settled lower by 78 points at 7460. Intra-day, it shuttled between 7545 and 7452. Taking cues from the Asian indices which are trading in negative territory, declining around 0.6 %, the domestic benchmark indices started the session on a negative note and remain in this territory.

The Nifty futures contract opens the session at 7545. Recording an intra-day high at 7555 the contract fell sharply and marked an intra-day low at 7493 levels. It currently tests a key support at 7500 levels. 
The near term outlook will remain bearish as long as the contract trades below 7,530 levels. Traders with a short-term perspective can make use of rallies to initiate short position with a stop-loss at 7555 levels. Also, a decisive fall below 7500 will indicate increase in selling pressure. Next supports are at 7460 and 7440 levels. On the other hand, significant resistance is at 7555. Only a decisive break through this resistance level will reinforce the bullish momentum and take the contract northwards to 7575 and 7620 levels.

STRATEGY: MAKE USE OF RALLIES TO INITIATE FRESH SHORTS

SUPPORTS: 7490, 7465

RESISTANCES: 7520, 7550