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Dear Friends,
Market seems to be missing on the follow on momentum after crossing over 4793 zone. Under all circumstances it can well be a false breakout if Nifty fails to maintain above the zone in coming days. Do note that the markets can show irrational exuberance over the short term and can divert away from the fundamentals. Over the Long term markets would show a perfect one is to one correlation with the Fundamentals of the economy.
One more factor worth watching is the appreciation of the JPY w.r.t the USD even when the emerging markets are Bullish. The way JPY is moving it can break its support at 89 in coming days and can lead to a currency lead sell off in the entire emerging spectrum including India. Traders who track the commodity and the foreign exchange market might have noticed a distinct factor at play in USD: INR markets. Although the index has almost doubled from its previous lows in October 2008. INR: USD has appreciated less then 8% from its all time lows. Equity and the Forex markets have a correlation of almost –1.
We are in a truncated series with only eight trading sessions remaining before we close the September series. Do note that the September series is fundamentally all-important as the markets would try and adjust for the quarter two earnings announcement from INDIA Inc. Watch if any correction takes the index below 4600 odd levels.
NIFTY SUPPORT:-4793,4650
Nifty resistance :-4830,4865
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TSR JULY SERIES REPORT.
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