Nifty: Ahead of Market: 12 things that will decide stock action on Monday

NEW DELHI: Domestic stock indices continued their losing streak on Friday as weak global signals kept investors on the sidelines. Selling pressure in banking, financial services and auto stocks weighed on the market and dragged the indices down.

Nifty ended below the all-important 15,700 mark and formed a “3 Weeks Tight” pattern on the technical charts, indicating limited upside potential. Will the market correct more in the coming days?

This is how analysts read the market pulse:

Samco Securities’ Nirali Shah said the index had reached near-term support at 15,500 and breaking that level would raise the red flag for the sustained uptrend. “This could trigger a profit booking move and possibly short-term market weakness,” she said.

Mazhar Mohammad of Chartviewindia.in said the technical oscillators were deteriorating in favor of the bears and the weekly MACD chart had generated a sell-signal. “It seems prudent to avoid buying dips while intraday traders are advised to short below the 15,630 level,” he said.

However, here’s a look at what some of the key indicators suggest for Monday’s action:


US stocks hit record highs at the end

The three major US stock indices rebounded to record closing highs on Friday as financials and other economically focused sectors rebounded from a sell-off triggered by growth concerns earlier this week. The Dow Jones Industrial Average rose 448.23 points, or 1.3 percent, to 34,870.16, the S&P 500 rose 48.73 points, or 1.13 percent, to 4,369.55, and the Nasdaq Composite rose 142.13 points or 0.98 percent to 14,701.92. For the week, the Dow is up 0.2 percent, and the S&P 500 and Nasdaq are each up 0.4 percent.

European stocks rise for bargain hunting

European stocks rose more than 1 percent on Friday, having their best session in two months, offsetting any losses this week as investors hunted for bargains after one of the worst sell-offs of the year amid worries over the global economic recovery. The pan-European STOXX 600 index was up 1.3 percent, with sectors that took a hit earlier this week, such as automakers and miners, up 4 and 3.4 percent, respectively. The mining sector marked its best session in two months.

Tech View: Nifty forms ‘3 Weeks Tight’ chart patterns

Nifty50 fell for the second straight year on Friday. During the day, the NSE barometer tested its recent swing low at around 15,630 before recovering some ground at the end of the day. The index formed a small bearish candle with a long wick that reflected intraday purchases. Analysts said the index is taking a breather and the uptrend appears limited for now. For the past five weeks, Nifty50 has been in a trading range between 15,950 and 15,500 levels, said independent analyst Manish Shah. “This is a ‘3 Week Tight’ pattern and in the context of the trend we have a pause before the push,” he said.

Check out the candle formations in the latest trading sessions

ETMarkets.com

Q&O: The relaxation of VIX gives some hope

India VIX fell 4.55 percent from 13.56 to 12.94. Declines in the VIX after rising in the last session have given the market some stability. On the options front, the maximum put open interest was 15,500, followed by 15,000 levels, while the maximum call OI was 16,000 followed by 15,800 levels. Minor call letters were seen at 15,700 and then 16,100 levels, while there were minor put letters at 15,200 and then 15,300 levels. Option data indicated an immediate trading range between 15,500 and 15,900 levels.

Stocks with a bullish tendency

The momentum indicator Moving Average Convergence Divergence (MACD) showed a bullish trading setup on the counters from Jindal Stainless, IRB Infrastructure, Kitex Garments, D-Link (India), Just Dial, Bharti Airtel, Dhani Services, Max Ventures, Navkar Corporation,

, Sutlej Textiles, Nectar Lifesciences, Rites, GHCL, Jindal Worldwide, Smartlink Holdings, Aegis Logistics, Bajaj Finserv, Filatex India, Vardhman Textiles, EIH, Balaji Telefilms, Jubilant Industries, Shalimar Paints, Kalyani Steel, Royal Orchid Hotels, HOV Services and Investment by Nalwa sons.

The MACD is known to signal trend reversals in traded securities or indices. When the MACD crosses the signal line, it emits a bullish signal, which indicates that the price of the security may be moving up and vice versa.

Stocks signal impending weakness

The MACD showed at the counters of Suzlon Energy, ICICI Bank, Axis Bank,

, NRB Bearings, Dharani Sugars,, Quick Heal Technology, Syngene International,, ICICI Lombard General Insurance, Orient Abrasives, PI Industries, Suumaya Industries, JMC Projects, Triveni Turbine, DCM Shriram,, RPP Infra Projects, AIA Engineering, Dhanuka Agritech, Uttam Sugar Mills, Vinyl Chemicals, DCM Nouvelle, Praxis Home Retail, Wendt India, The United Nilgiri and Welspun Investments. A bearish crossover in the MACD on these counters indicated that the downtrend has only just begun.

The most active stocks in terms of value on Friday

Tata Steel (Rs 2,179.54 billion), TCS (Rs. 2,057.43 billion), Tata Motors (Rs. 1,493.60 billion), Adani Ports SEZ (Rs. 1,082.91 billion), Just Dial ( Rs. 1,011.61 billion), Bajaj Finserv (Rs. 1,006.06 billion), Bajaj Finance (886.82 billion rupees), RIL (865.38 billion rupees), HDFC Bank (805.09 billion rupees). Rupees) and Granules India (Rs. 746.94 billion) were among the most active stocks on Dalal Street in terms of value. Higher activity on a meter in relation to its value can help identify the meters with the highest trading volume for the day.

The most active stocks in terms of volume on Friday

Reliance Communication (shares traded: 23.49 crore), Vodafone Idea (shares traded: 17.90 crore), JP Power (shares traded: 9.34 crore), YES Bank (shares traded: 6.71 crore), Suzlon Energy (shares traded: 5.03 crore), Tata Motors (shares traded: 4.88 crore), BHEL (shares traded: 4.62 crore), PNB (shares traded: 4.51 crore), Dish TV India (shares traded: 4.62 crore), Dish TV India (shares traded: 4.62 crore), Dish TV India (shares traded: 4.62 crore), : 4.32 crore) and SAIL (stocks traded: 3.60 crore) were among the most heavily traded stocks at the session.

Shares with buying interest

Macrotech Developers, Jindal Stainless, IRB Infra Development, Hinduja Global and Tide Water Oil saw strong buying interest from market participants as they climbed their new 52-week highs, suggesting bullish sentiment.

Stocks are under selling pressure

Uttam Galva Steels and RIL (PP) experienced strong selling pressure and hit their 52-week lows, which signals a bearish sentiment on these counters.

Mood meter favors bulls

Overall, the market breadth remained in favor of the bulls. Up to 264 stocks in the BSE500 index finished the day in the green, while 226 finished the day in the red.

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