Analysis Report #CNX Nifty 50

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NIFTY Analysis

Overview :
The NIFTY 50 index is National Stock Exchange of India's benchmark broad based stock market index for the Indian equity market. It represents the weighted average of 50 Indian large cap company stocks. Nifty is owned and managed by India Index Services and Products (IISL), which is a wholly owned subsidiary of the NSE Strategic Investment Corporation Limited. IISL had a marketing and licensing agreement with Standard & Poor's for co-branding equity indices until 2013. The Nifty 50 was launched on 21st April 1996. NIFTY 50 is the world’s most actively traded contract.

Today, Dalal Street seen the bloodbath after the huge rally from last couple of days. Nifty 50 declined 256.30 points, or 2.33% and closes at 10,760.60. On the last day of the week and ahead of budget investor get disappointed and sells the equity worth over 5 lakh crore. The main cause of this disappointment is  the LTCG (Long Term Capital Gain) on Equity. The Union budget proposes 10.04% LTCG including cess over Rs. 1 Lakh. Till now, any long-term gains made on equity shares or any equity mutual fund units were exempt from tax.
Technical View :
On the weekly Chart, Nifty is rising but volume is declining since from few weeks. Along with this it is forming Bearish Engulfing Pattern with Volume on weekly chart. RSI (Relative Strength Index) is above 70 showing the Overbought sign. This weekly fall with volume shows that this decline is not settle down immediately. On daily time frame Nifty is forming Black Marubozu, which shows further more downfall is expected in upcoming days. Price is going down with increase in the volume, means interest of investor is shifted from buying to selling. NIFTY OI is rises by 4.82% which shows the Short Built up.

We are seeing the NIFTY will go further down till 10555 - 10400 in upcoming trading sessions. This is the rock bottom for Nifty in upcoming days. If market hold this bottom then and only then Investor think to add or buy stocks, till then stay cautious and wait to settle down the budget dust.






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