InvestorQ : What is your trading view for 12 March? Could we see a gap up opening for the Nifty on Friday?
shrinidhi Rajan made post

What is your trading view for 12 March? Could we see a gap up opening for the Nifty on Friday?

diksha shah answered.
1 year ago

On Friday, the Nifty and the Sensex will open after a one-day trading holiday. On Wednesday, the Nifty closed strong to close at 15,175, even as the Sensex settled at 51,279 levels. Both the indices have closed on Wednesday above their crucial support levels. Friday will be crucial in determining the medium-term direction of the markets.

Needless to say, the biggest news for Friday will be the US Stimulus worth $1.90 trillion finally getting the go-ahead. It needs to be remembered that this is a lot of money sloshing around and could once again create a liquidity glut in markets as ECB also loosens policy. Don’t be too surprised to see another liquidity driven rally going ahead.

FPI action was relatively tepid on Wednesday as the net selling was almost insignificant at Rs.16 crore. Interestingly, on the same day the domestic institutions bought Rs.448 crore of equities on Wednesday. As traders return on Friday to Indian markets, there is likely to be some amount of caution as Friday is the last trading day of the week.

On Thursday, the rally in the US markets continued to scale new highs on the back of the heavy liquidity infusion. For example, the Dow Jones was up 1.2% while the NASDAQ index was up 2.66%. European markets were flat to positive and even the SGX Nifty is not showing any clear direction. Asian market could hold the cue but liquidity will be the theme.

Coming back to your question on a gap up opening, the answer is that the gap-up will happen on Friday as the Nifty will try to fill the gap with SGX Nifty. On Thursday, the SGX Nifty had closed above the 15,400 mark, so the Nifty has some 150 points gap to fill up and that gap is likely to be filled up first thing in the morning on Friday.