Here’s how analysts read the market pulse:
Independent analyst Manish Shah said if Nifty50 sustains above 18,100, it should see a rally towards 18,300-18,350. “This should be the target for weekly expiry. Price action precedes lagging indicators. MACD is in a ‘sell’ mode and a rising 50-period moving average will act as a support,” he said.
Mazhar Mohammad of Chartviewindia.in said Nifty50 erased preceding three trading sessions of losses in just one single stroke. “Sustaining above the 17,900 level, it should ideally head to test its interim top of 18,342 levels, though logical targets are present around 18,405 level,” he said.
That said, here’s a look at what some of the key indicators are suggesting for Monday’s action:
Wall St ends higher with boost from big tech
Wall Street stocks closed higher on Friday, with market-leading growth shares kick-starting indexes’ climb as investors looked past disappointing U.S. economic data. Despite their advances, all three major U.S. stock indexes ended the session below last Friday’s close, ending a five-week streak of weekly gains. The Dow Jones Industrial Average rose 179.08 points, or 0.5 per cent, to 36,100.31. The S&P 500 gained 33.58 points, or 0.72 per cent, at 4,682.85 and the Nasdaq Composite added 156.68 points, or 1 per cent, at 15,860.96.
European shares gain for 6th straight week
European shares closed their sixth straight week of gains at a new high on Friday, as strong results from Cartier owner Richemont rounded off a robust earnings season. The pan-European STOXX 600 index rose 0.3 per cent to a new peak of 486.75 points, and added 0.7 per cent for the week. It has finished at record highs in four of the five sessions this week.
Tech View: Resumption of upswing
The strength of the move on Nifty50 on Friday has led analysts to recommend initiating long positions in the market going ahead. Analysts now see the index moving towards 18,300 points and expect 17,900 points to act as strong support.
F&O: Sideways movement seen likely
In the derivatives segment, traders aggressively bought out-of-money call options of Nifty50 index indicating that they expect further gains in the market going ahead. The 18,500 strike price call option saw the highest addition of Open Interest on Friday.
Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade setup on the counters of Vedanta, M&M, Tech Mahindra, Tata Coffee, and Shree Rama Newsprint.
The MACD is known for signaling trend reversals in traded securities or indices. When the MACD crosses above the signal line, it gives a bullish signal, indicating that the price of the security may see an upward movement and vice versa.
Stocks signalling weakness ahead
The MACD showed bearish signs on the counters of Indian Oil, Ashok Leyland, RVNL, EIH, and Bharat Dynamics. Bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.
Most active stocks in value terms
Tata Steel (Rs 3,013 crore), Zomato (Rs 2,097 crore), FSN E-Commerce (Rs 1,345 crore), ICICI Bank (Rs 1,193 crore), HDFC Bank (Rs 1,157 crore), Tata Motors (Rs 1,044 crore), RIL (Rs 1,038 crore), SBI (Rs 1,010 crore), Tata Power (Rs 1,004 crore) and InterGlobe (Rs 947 crore) were among the most active stocks on Dalal Street in value terms. Higher activity on a counter in value terms can help identify the counters with highest trading turnovers in the day.
Most active stocks in volume terms
Vodafone Idea (Shares traded: 28.5 crore), Zomato (Shares traded: 14.1 crore), IDFC (Shares traded: 4.6 crore), YES Bank (Shares traded: 4.4 crore), Tata Power (Shares traded: 4.2 crore), NALCO (Shares traded: 4.2 crore), BHEL (Shares traded: 3.7 crore), Devyani International (Shares traded: 2.95 crore), and Suzlon Energy (Shares traded: 2.9 crore) were among the most traded stocks in the session.
Stocks showing buying interest
Asahi Ind Glass, Sheela Foam, IDFC, Devyani International, Minda India and Zomato witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signaling bullish sentiment.
Stocks seeing selling pressure
Generic Engineering, Quadpro ITeS, and Vikas WSP witnessed strong selling pressure and hit their 52-week lows, signaling bearish sentiment on these counters.
Sentiment meter favours bulls
Overall, the market breadth remained in favour of the bulls. As many as 283 stocks on the BSE500 index settled the day in the green, while 217 settled the day in the red.
Podcast: Why FPIs are booking profits while retail investors are buying
After selling stocks worth over Rs 13,000 crore in October, FPIs have pulled out funds to the tune of Rs 4,694 crore so far this month. Are foreign investors worried about lofty valuations or tapering by the Fed? In today’s special podcast with independent market expert Rajiv Nagpal, we try to understand whether retail investors, who are flush with cash, can continue to support the market even as foreign investors cash out.
