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Market Update 12. 04. 2021

Hello everyone!

Hope you all are having a great weekend. Here's a quick market update for the coming week.

So what have we learned this week? U.S. markets have been hitting all-time highs while Asian markets are struggling and seem mixed. Banknifty has been following structure as per the last few weeks' updates. The 38.20% level remains sacrosanct as long as Friday's high holds in place. On a local basis, covid cases have been on the rise and state governments have insisted on a curfew with strict state regulations.

Last week RBI Governor came out with the Indian style of QE. Nobody expected this kind of liquidity measure. As a result Bank Nifty shot up more than 1000 points from an intraday low. On that particular day, FII and DII both turned out to be net buyers in the cash segment. The RBI Policy acted as a trigger for short covering but that started to come off as well. Our Indian markets have been underperforming.

SPX has reached the 1.618 fib extension. Will it go even further? From what we have learned so far in 2021 and I say it again. Simple: The relentless liquidity machine remains in full control. In addition to renewed and larger fiscal stimulus central bankers, including the Fed, have made it abundantly clear they will keep printing no matter what the data shows, no matter how much inflation there is (“let it run hot”).