Indian stock markets are reigning in uncertainty as Investors are longing to know the outlook and vision of newly appointed RBI Governor Dr. Urjit Patel. Nifty didn’t react optimistically as expected in response to Modi government announcing the appointment of new governor. Instead Price action continued to trade in cautious mood.
Markets will most likely view Dr. Patel as stronger proponent of current inflation centric monetary policy framework. The current Market action is an example of the sentiment. From Long term perspective Nifty is trading in a ranging structure and Price action needs strong of influx of liquidity to trend in either direction.
Nifty Price Action on 15 Min Following The Announcement of RBI Governor.
Market structure shifted from trend to Range in the beginning of August due to absence of strong fundamental factors which influences price action. As a result, Option hedging increased and investors started focusing more on short-term gains causing a rise in volatility. Nifty was trading in a range between 8700-8500. Market participants became anxious about the most watched radar level 9,000. As Dr. Urijit Patel takes charge of RBI panel, Investors will continue being cautious with this rhetoric unless a clear picture emerges.
Nifty is Trading in Range on 4h Chart Keep Your Eyes on Fundamentals.
Next RBI policy will be keenly watched by Market participants. The moves, positions of Foreign Institutional investors and Domestic institutional investors can highlight the mindset of smart money players. Government bond yields and swap rates will probably be affected; Volatility of Indian rupee can offer significant clues about future market direction of Nifty 50 and Bank Nifty.
