Weekly Market Outlook | 14th Dec to 18th Dec 2020

Weekly Market Outlook – 14th Dec to 18th Dec 2020

Nifty hits new all-time high of oddest number 13579 with positive closing for the sixth consecutive week.

As we said earlier that we are in a roaring bull market because of Nifty and Sensex both end with a weekly gain for the sixth consecutive week whereas they hit a new all-time high for the fifth consecutive week. Nifty hits a new high of 13579 which is the oddest number in the oddest year which has an even number 2020 while Sensex hits an all-time high of 46309. At the end of the week, they both ended with a gain of around 2%.

If we talk about last week hero then it was the FMCG sector which ends with a gain of more than 6% in the leadership of heavyweights ITC and HUL.

Data Analysis:

Foreign Institutional Investors remain on the driver’s seat where they bought around 16719cr in the cash market last week while DIIs are still in the mood of selling as they sold around 12434 Cr in the cash market.

If we talk about F&O data then FIIs long exposure in index future stands at 77% which was the same as last week but it is still a little elevated level. PCR ratio stands at 1.55 mark which is a comfortable level.

What do Technical Charts Say?

Technical charts say that Nifty is in strong bullish momentum but last week’s high of 13579 is a critical number as per Gann’s theory, therefore, we could see some resistance at this point while above the 13579 levels, 13689/13770 will be the next target levels for the Nifty. On the downside, 13400-13300 is an immediate demand zone while 13150-12950 is a critical demand zone because below the 12950 levels, we can expect any trend reversal.

If we talk about Banknifty then it is also showing decent strength where 30800-31000 is an immediate supply zone; above this, 31500/32000 will be the next resistance levels. On the downside, 30200-29800 will be an immediate demand zone while 29000-28500 will be the critical demand zone.

Important cues for the next week:

    • Inflation numbers: Both CPI and WPI numbers will be announced on Monday for India and they may have a significant impact on the market because the stock market is worrying about high inflation numbers amid a rise in commodity and vegetable prices.
    • US Fed meeting outcome: We will have the outcome of the US Fed meeting on 16th December which will have a significant impact on global markets.
    • Other central banks meeting: BOE and BOJ will also come out their monetary policy on 17th December and 18th December respectively.
    • Covid19 cases and vaccine-related news: The trend in COVID19 cases and news flow regarding vaccines will continue to impact global markets.
    • FIIs’ behaviour: FIIs’ behaviour will be the key for the market direction as they are driving the current bull market.

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