The BSE Sensex plunged over 1000 points and CNX Nifty declined over 300 points in 2 session after RBI policy.Let me put the reason from both Technical and Fundamental Perceptive
- RBI pause on further rate cuts:
This indicated that the RBI will take further action based on inflationary developments. The CPI inflation will remain benign for the next few months before showing an increasing trend.
- Monsoon forecast stokes fears of drought
The government has downgraded this year’s monsoon forecast to 88 per cent of the long-period average, Earth Sciences Minister Harsh Vardhan said, raising fears of a drought in the country where nearly half of farmland lack irrigation facilities.
- Greece Negotiation:
- US Federal Reserve Rate hike:
2. Technical Reason
- Trading below 200 DMA: Nifty/ Sensex after 15 months are trading well below its 200 DMA, putting pressure on market, as many FII’s have 200 DMA benchmark for buying or selling.
- Gann Date Effect- As discussed in Weekly Analysis and Daily Analysis Gann/Appoint and Gunner plays an important role in finding impulsive move, all studies were pointing towards a big move.
- Forming Base before the next big move, Market are currently trading in 4 wave which leads to time and price correction, if one observe the daily chart we are trading in a big range of 8000-8500 from past 2 months with a voaltile bias, these kind of price action leads to base building from next move.