Positives:
1) SGX nifty last closed on Friday at 14832, significantly above our closing price of 14,677.80
2) All the major US indices- DJIA, NASDAQ and S&P 500 closed in green by 1.06%, 2.32% and 1.49%, respectively, on Friday night.
3) All major European indices also closed in green – FTSE (1.15%), CAC (1.54%) and DAX (1.54%).
4) On daily chart, Nifty is at perfect point of reversal- closing above midline of Bollinger band and 50 DEMA but just below 20 DEMA.
5) Covid-19 cases in India are gradually reducing day by day and so are deaths reported by various states.
6) FIIs were net buyers in Nifty futures worth 625 Crs.
Negatives:
1) FIIs are on a selling spree and on Friday sold 2607 Crs. worth shares in Cash segment, highest figure this month so far. DIIs bought only shares worth 613 Crs. In stock futures too FIIs sold 902 Crs worth futures.
2) On daily chart, Banknifty closed below the mid line of bollinger band and was trading below its 20 DEMA and 50 DEMA, finishing as strong red candle on Friday, with lower high, lower low and lower close w.r.t. previous trading session.
3) Out of all the major constituents of Banknifty, only ICICI Bank is showing encouraging signs of reversal. Rest all are showing full bearish signs.
So overall picture is slightly bullish just because of positive global cues, improving Covid figures and positive lead shown by SGX Nifty Friday night. So one can take a long trade in Nifty but avoid banknifty because inherently it is weak but if Nifty rises it may either consolidate or rise a bit. Unfortunately no clear cut levels are seen to go long in either of the indices so trade will have to be taken depending on situation.