Markets Likely to be Choppy Ahead

Investors must brace for wild swings in the stock markets as the unwinding of easy monetary policy and a surge in case of the Omicron variant of Covid-19 have given bears the upper hand.

The Nifty could see its strong support of 16800 getting tested this week with foreign investors extending their selling spree in the wake of dollar strength with the US Federal Reserve adopting a Hawkish stance amid escalating inflationary pressures.

Much will depend on whether the resilience of domestic investors, who have been buying as foreign funds sell, will continue.

The Nifty ended below the 17000-mark at 16985.20 on Friday. The Sensex and Nifty fell 3% last week, logging their second worst week in almost 10 months. “The overall chart pattern indicates a negative outlook ahead and one may expect further fall in the benchmark and broader indices ahead,” said Nagaraj Shetty, technical research analyst, HDFC Securities.

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