Some recovery from demonetisation lows: Angel Broking

Weekly Market Wrap Up by Mr. Sameet Chavan (Chief Analyst-Technical and Derivatives, Angel Broking):

"Last Friday, our markets locked into a lower circuit for 45 minutes and after resuming the trade, we witnessed a v-shaped recovery of nearly 17-18% from the lows. Many might have thought the bottom is made and worst is behind us. But market is never as easy as it appears. The coronavirus pandemic fear aggravated over the weekend and hence global markets again started bleeding. As a result, we not only tested last Friday's low but also convincingly breached to see sub-8000 levels, lowest since 'Demonetisation'. Fortunately for us, we managed to recover some ground thereafter and eventually concluded the week at 8750 with a severe cut of 12% on weekly basis.

Generally such price action happens when the panic bottom is made. But this time, things have defied all the traditional theories of stock market and hence it would be hard to decide whether the worst is behind us. It's better not to pre-empt anything and should keep focusing on further developments with respect to coronavirus. This week, the major culprit pocket has been the financial space and it is surprising to see few marquee names like HDFC Bank and Bajaj finance also had to succumb to this meltdown. The law of gravity has finally weighed down heavily on these all time favourite names. Thus, we reiterate traders should avoid aggressive bets as well as leveraged trades. For a time being, better to be with some defensive names like Pharma who has done remarkably well throughout this week.

For the Nifty, 8200 followed by 7832 are the downside supports and on the higher side, extended recovery can be seen after reclaiming 9000 on a sustainable basis. We continue to maintain our stance that these declines are providing opportunities to accumulate quality stocks in a staggered manner."

Source : Equity Bulls

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