Fed meeting, FII inflows among factors that will keep traders busy this week

For the latest signals, market Participants will be watching with eagerness for next week’s US Federal Reserve monetary policy results and forward-looking guidance. Crude oil and Indian currency will also play an important role in the market movement. In addition, the Japanese inflation rate for February will be announced on March 24, 2023.

The next US monetary policy meeting is scheduled for March 21-22. US Fed It is expected to approve a quarter-percentage-point interest rate hike next week, despite turmoil in the banking industry and further uncertainty, according to market experts.

“In the absence of any major domestic events, focus will shift to the upcoming FOMC meeting scheduled for March 21-22. Besides this, crude oil volatility and overseas inflows trend will also be in focus for signals,” said Ajit Mishra, VP – Technical Research, Religare Broking Ltd.

“Market may take relief initially but the upside also seems capped. Mishra said, Nifty may face hurdles around 17,250-17,400 zone, while 16,600-16,800 zone will provide necessary cushion, if the situation worsens further.

Since we are witnessing a mixed trend across sectors, Mishra said traders should continue to focus on overnight risk management with a stock-specific approach.

OMC to stay in focus

Metal shares Some momentum could be seen after China’s central bank cut CRR by 25 basis points in an effort to stimulate its economy. Realty stocks are witnessing buying after DLF announced record sales growth. Cement, paints and OMCs will also be in focus as oil is at 15-month low.

“Going forward we expect the market to expect a rate cut of 25 bps at the Fed policy meet next week due to short term pullback on lower US PPI inflation and slower US retail sales data. However the market structure is still weak and hence traders should take a cautious approach at higher levels,” said Siddharth Khemka, Head – Retail Research, Motilal Oswal Financial Services Ltd.

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After showing high volatility at 16850 low on Thursday, Nifty showed a sustainable uptrend with volatility on Friday and closed the day up 114 points, said Nagaraj Shetty, Technical Research Analyst, HDFC Securities.

A negative candle with a long lower shadow formed a small body on the daily chart. Technically, this pattern, Shetty said, signals the formation of a long legged doji type candlestick pattern (not a classical one). “Hence, we observe a back to back doji pattern in the last two sessions. The current market action suggests that the market is in the process of near term formation,” he added.

“On the weekly chart, Nifty has formed a long bear candle with a lower shadow. Negative chart patterns like lower tops and bottoms are intact on the daily chart and Thursday’s swing low at 16850 can be considered as the new lower bottom of the sequence. It can be expected that by next week, Nifty will move towards the next upper resistance level of 17300-17350 from here. Immediate support lies at 16950 level,” Shetty said.