Negative dataflow for the Indian economy continues. The August IIP data declining to – 1.1 percent is probably indicative of the risk of slowdown reflecting in Q2 corporate earnings. Consumer Price Index (CPI) and the Wholesale Price Index (WPI) for September will be released on October 14. World Bank also said the slowdown in India is severe, cuts GDP forecast to 6%.
The underperformance of Mid and Small-cap sectors continues.
The breakdown below 11150 as expected in my last post has not materialized yet. Nifty has moved sideways for the last few days. Even though the EMAs are bullishly positioned, market will gain strength only above 11350. Nifty current range is between 11150 – 11350.
Nifty Long Term
This week is more about consolidation after the last two weeks’ sharp selloff. Expect sideways action unless this week high/low is not taken out.
Charts will remain bearish as long as Nifty remains below 11500. The rising wedge breakdown will remain in force.