Tuesday, September 1, 2020

The Sensex Outlook for the Day - 01-09-2020

Market intellectuals may attribute yesterday's crash to anything of the following reasons:
  • Fresh tensions in Ladakh 
  • New Margin Trading rules kicking in from today
  • End of the Moratorium period yesterday
  • Or the massive GDP contraction (announced post closing yesterday).
But the writing on the charts was clear on Friday itself - closing above 39580/11681 would require a massive Bull effort which would be nearly impossible given the already sharp run-up.That is the reason we brought NIFTY September Puts as a BTST trade on Friday itself.

The level of 39015 (11515) was a part of the trendline which was supporting the markets from ~20th August. Having broken that trendline support, the markets are in for further weakness before stabilizing.

Continue to remain short on the NIFTY, while taking a stock-specific view.

Do not get fooled or carried away but any bounce/rise. The resumption of the uptrend is a few days/weeks away.

Date 1-Sep-20
Index Sensex Nifty
S2            38,240            11,273
S1            38,417            11,325
Previous Close       38,628.29       11,387.50
R1            38,800            11,438
R2            38,908            11,470
Fair Value            28,991              8,546


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