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Due to the lack of positive strength in global markets and ongoing worries of further rate hikes by major central banks, investors are risk-averse and steadily reducing holdings. Caution along with weak market sentiment will prevail as all eyes will be on the US FOMC minutes released on Wednesday which will provide some clues on the Fed's rate decision going forward. Benchmark indices ended negative in the highly volatile October 10th session. At the close, the Sensex was down 200 points, to 57,991 and the Nifty was down 73 points to 17241. Fears of an aggressive Fed rate hike amid strong US employment data disrupted global equity trends. Given the low supply and high demand scenarios, US inflation is expected to remain high. In order to achieve some parity in the economy, the Fed must aim to reduce demand by raising the unemployment rate, which the market ignores. In addition, rising crude oil prices and devaluation of the rupee increase the risk of imported inflation in India affecting the domestic market. Markets are showing tremendous resilience given the weak global environment, however, traders are facing difficult times due to moderate volatility. And now that earnings season has begun, we expect volatility to remain high. Technically, the Nifty found support at 17100 and rallied strongly. On daily charts, the index has formed a bullish candle and also a reversal pattern that is largely positive. For traders, support has shifted to 17250 from 17100. Above 17100 , the index could retest the 17300-17400 level. On the other hand, a new round of selling is only possible after 17100 is eliminated. Below that, the index could slip as low as 17000-16800.
Resistance: 17400,
17550, 17700
Support: 17300,
17150, 17000
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