Shrikant Chouhan, Executive Vice President, Equity Technical Research, Kotak Securities, said, “For the next few trading sessions, 13,650 should be the sacrosanct level for the trend following traders. Above the same, we can expect an uptrend continuation wave up to 13,935-14,000. On the flip side, dismissal of 13,650 could possibly trigger one quick correction leg till 13,500.”
That said here’s a look at what some of the key indicators are suggesting for Monday’s action:
Wall Street closes lower as stimulus rally cools
US stocks ended lower on Friday, pulled down by uncertainty around a coronavirus stimulus deal, while Tesla shares jumped in heavy trading in anticipation of their addition to the S&P 500 next week. All three major indexes hit record highs at the opening before retreating. The S&P 500 technology index, which has led gains this week, was the biggest drag on the overall benchmark index. The Dow Jones Industrial Average fell 0.41%, the S&P 500 lost 0.35%, and the Nasdaq Composite dropped 0.07%.
European stocks break 4-day rally
European shares fell on Friday as doubts over a post-Brexit trade deal and a stimulus package in the United States capped gains at the end of a solid week. The pan-European STOXX 600 index broke a four-day rally to end 0.4% lower, reversing gains that followed a surprise rise in German business morale in December. The German DAX gave up gains of as much as 0.8% to end in the red.
Tech View: Nifty bulls invincible
The index formed an indecisive candle, that resembled a Dragonfly Doji. Now holding above the 13,650 level would be key for Nifty to sustain the ongoing rally, said analysts. This rally can be a cause for concern, hinting at outlandishly bullish sentiment, said Mazhar Mohammad of Chartviewindia.in. He said a close below 13,650 level can act as a harbinger of near-term weakness on the index.
Check out the candlestick formations in the latest trading sessions
ETMarkets.comF&O: Buying on dips continues
India VIX slipped 2.81 per cent from 19.15 to 18.62. The overall lower volatility suggests the bulls are holding a tight grip on the market and any small decline could trigger buying. On the options front, maximum Put Open Interest stood at 13,000 level followed by 13,500, while maximum Call OI was at 13,000 followed by 14,000 levels. There was marginal Call writing at strike prices 14,000 and 14,200 while Put writing was seen at 13,700 and then 13,500 levels.
Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) on Friday showed bullish trade setup on the counters of DCW Ltd, Orient Cement, Bajaj Finance, Cummins India, Just Dial, Xchanging Solutions, DCM Shriram, Divi’s Lab, Kiri Industries, Sundaram Fasteners, Kajaria Ceramics, Linde India and D P Abhushan.
Stocks signalling weakness ahead
The MACD showed bearish signs on the counters of Punjab National Bank, Lemon Tree Hotels, National Aluminium, Central Bank, Power Finance Corp, Union Bank of India, Alok Industries, Rail Vikas Nigam, Adani Ports & SEZ, Au Small Finance Bank, DCB Bank, and others.
Friday’s most active stocks
Dr. Reddy’s (Rs 1925.61 crore), Infosys (Rs 1900.21 crore), TCS (Rs 1746.28 crore), Bajaj Finance (Rs 1704.43 crore), RIL (Rs 1688.74 crore), HDFC Bank (Rs 1628.15 crore), Tata Steel (Rs 1605.16 crore), IndusInd Bank (Rs 1325.98 crore), Larsen & Toubro (Rs 1325.57 crore) and Pidilite Industries (Rs 1208.94 crore) were among the most active stocks on Dalal Street on Friday in value terms.
Friday’s most active stocks in volume terms
YES Bank (Shares traded: 28.31 crore), Vodafone Idea (Shares traded: 20.32 crore), RattanIndia Power (Shares traded: 7.58 crore), Suzlon Energy (Shares traded: 6.53 crore), PNB (Shares traded: 6.40 crore), SAIL (Shares traded: 5.12 crore), Tata Power (Shares traded: 4.99 crore), Tata Motors (Shares traded: 4.61 crore), BHEL (Shares traded: 4.05 crore) and Lemon Tree Hotels (Shares traded: 3.96 crore) were among the most traded stocks in the session.
Stocks showing buying interest
L&T Tech, DCM Shriram, Pidilite Ind, CAMS and IndiaMART witnessed strong buying interest from market participants as they scaled their fresh 52-week highs on Friday, signalling bullish sentiment.
Stocks seeing selling pressure
Ravinder Heights, Anant Raj Global, Jump Networks, IndiabullsVentures (PP) witnessed strong selling pressure in Friday’s session and hit their 52-week lows, signalling bearish sentiment on these counters.
Sentiment meter favours bears
Overall, market breadth remained in favour of bears. As many as 200 stocks on the BSE 500 index settled the day in green, while 296 settled the day in red.
Podcast: Can the holiday season spoil the bulls party on Dalal Street? >>>
Will the Santa rally, which several experts believe started too early, extend till the New Year or will the overstretched Nifty get bogged down by profit booking? As investors hunt for value, can PSU bank stocks be a good choice? We find out this and more in today’s special podcast with independent market expert Rajiv Nagpal.
