Ahead of the Market: 10 Things That Will Decide Your Stock Trading Monday
Both the NSE Nifty 50 and BSE Sensex rose around 2.3 per cent this week, extending their gains for seven straight weeks and their longest run since January 2018.
IT companies, which account for a significant portion of their sales in the United States, rose 7.16% this week, hitting their highest level in 26 months.
Here’s how analysts read the market pulse.
“The sentiment in favor of the bulls is strong, as can be seen from the absence of any reversal signals on the technical charts. Resistance is observed at 21,500, while a violation of this level could lead to a potential further rally in Nifty. Current support is at “It was at 21,300,” said Rupak De of LKP Securities.
Sharekhan’s Jatin Gedia said, “On the daily chart, we can see Nifty stretching higher towards 21500. The rally has been essentially vertical and there are still no signs of weakness on the price front. The daily momentum indicators are: Positive A crossover has occurred but no new highs have been recorded, which indicates that a negative divergence is underway. However, we will continue to ride higher until we see signs of weakness on the price side. A short-term target is set on the upside. At 21500.”
That said, let’s take a look at some key indicators that suggest action on Monday.
american market
Wall Street stocks wobbled to a mixed close and the dollar rebounded on Friday as market participants took a breather at the end of a week packed with central bank policy decisions and important economic data.
All three major U.S. stock indices were oscillating for much of the session, but by bell, the S&P 500 was nominally lower, the Dow was modestly higher, and interest rate-sensitive technology and technology-adjacent momentum stocks had the Nasdaq in the lead.
The Dow Jones Industrial Average rose 0.15%, the S&P 500 fell 0.01% and the Nasdaq Composite surged 0.35%.
european stocks
European stocks rose slightly on the final day of the week after key central bank policy decisions were announced. In this decision, the US Federal Reserve (Fed) set the tone for market expectations that an interest rate cut was imminent.
The pan-European STOXX 600 index rose 0.1% on Friday, marking its fifth straight weekly gain and its longest weekly gain streak since April.
Technical Perspective: Green Candle
On Friday, Nifty rose 274 points to hit a lifetime high and formed a green candle on the daily and weekly charts.
Once the immediate resistance at 21492 is cleared, further upside is likely. However, caution is needed in the near term as the 14-day RSI is in overbought territory at 84.93. Hence, one can take advantage of the short-term correction to buy quality stocks, said Subash Gangadharan, senior technical and derivatives analyst at HDFC Securities.
Stocks with a bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trading on counters Zensar Technologies, Amber Enterprises, Godawari Power, Team Lease, Service, Kaynes Technology and SKF India.
MACD is known to indicate a trend reversal in a traded security or index. When the MACD crosses above the signal line, it sends a bullish signal, indicating that the price of the security may rise and vice versa.
Stocks predict weakness ahead
MACD showed bearish signs on the counters EIH, Prince Pipes, UTI AMC, AIA Engineering, Kalpataru Power and Gland Pharma. A bearish crossover in the MACD of this counter indicates that it has just begun its downward journey.
Most Active Stocks by Value
HDFC Bank (Rs 11,492 crore), TCS (Rs 3,250 crore), Infosys (Rs 2,871 crore), RIL (Rs 1,981 crore), SBI (Rs 1,902 crore), ICICI Bank (Rs 1,480 crore) and Adani Enterprises (Rs 1,458 crore) ) has been one of the most active stocks on the NSE in terms of value. The higher activity of a counter in terms of value can help identify which counters have the highest turnover for the day.
Most active stocks by trading volume
Tata Steel (Shares traded: KRW 7.7 billion), HDFC Bank (Shares traded: KRW 6.9 billion), Power Grid (Shares traded: KRW 4.1 billion), SBI (Shares traded: KRW 2.9 billion), NTPC (Shares traded: 28 billion), ONGC (shares traded: $2.2 billion) and Wipro (shares traded: $200 million) were among the most traded stocks in the NSE session.
Stocks showing interest in buying
Stocks such as HCL Tech, TCS, SBI, Tata Steel, NTPC, Tech Mahindra, LTIMindtree, etc. touched 52-week highs, showing strong buying interest from market participants, indicating bullish sentiment.
Stocks under selling pressure
No major stock hit a new 52-week low on Friday.
Sentiment Meter Favors Bulls
Overall, market breadth favored the bulls. 1,931 stocks closed in the green and 1,842 stocks closed in the red.
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(Disclaimer: Recommendations, suggestions, views and opinions provided by experts are their own and do not represent the views of The Economic Times.)
