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

New Delhi: Nifty50 snapped a two-day losing streak and ended above the 10,350 mark on Friday, forming a Doji on the daily chart.

Rohit Singre of LKP Securities says Nifty has a strong hurdle in the 10,500-10,600 zone for the coming week. “Once the index manages to sustain above this level, it may see a smooth move towards the 11,000 mark,” he said.

“Nifty’s support exists near the 10,300-10,200 zone and the overall base stands at the 10,000 mark. Any dip near the 10,000 mark will again be a good buying opportunity,” he said.

Jimeet Modi of SAMCO Securities said the index seems to be facing a major hurdle at 10,550 level and this level coincides with the 61.8 per cent Fibonacci retracement of the fall from the top to the recent bottom.

“Though the trend is upward now, we expect the upside to remain limited going ahead. Nifty will test the lower end of the channel drawn from the bottom, which comes at 9,700 level,” he said.

That said, here’s a look at what some of the key indicators are suggesting for Monday’s market action:


US stocks tumbled on Friday


The broader US stock market tumbled on Friday as investors grew increasingly worried about the economic outlook. The Dow tanked 730 points, or 2.8%, while the Nasdaq lost 2.6% and the S&P 500 — the broadest measure of Wall Street — fell 2.4%.

European shares saw tempered gains

European stocks rose on Friday, but gains were tempered by a record rise in coronavirus cases in the US. The Stoxx Europe 600 index rose 0.4% to 361 after 0.7% gain on Thursday while German DAX rose 0.2%, the French CAC 0.5% and the FTSE100 0.78%.

Tech View: Nifty hurdle seen at 10,550

Nifty50 advanced on Friday but formed indecisive candles on daily and weekly charts. While the index formed a Doji pattern on the daily chart, opening and closing almost at the same levels, it made a Spinning Top candle on the weekly scale, suggesting that it continued to struggle at higher levels. In the coming week, the 10,550 level will be a key hurdle to watch out for.

F&O: Nifty range at 9,800-10,800

On the options front, maximum Put open interest stood at 9,000 level followed by 10,000, while maximum Call OI was at 11,500 followed by 10,500 levels. Marginal Call writing was seen at 11,200 and 10,800 levels, while there was Put writing at strike price 10,000 and then 9,500. Options data suggested a wider trading range between 9,800 and 10,800 levels.

Stocks showing bullish bias

Momentum indicator Moving Average Convergence Divergence (MACD) on Friday showed bullish trade setup on the counters of Tata Power, Infosys, Mangalore Chemicals, Mindtree, NIIT Technologies, Nucleus Software, Bhansali Engg, Crompton Greaves, Saksoft, Refex Industries, California Software, Vishnu Chemicals, Vipul, TTK Prestige, AMD Industries, Abbott India, Bannari Amman Spinnings, Garware Tech Fibres, Linc Pen, Raj Television Network, Pilani Investment and Zenith Exports.

Stocks signalling weakness ahead

The MACD showed bearish signs on the counters of Sumitomo Chemical, Hexaware Technologies, InterGlobe Aviation, Firstsource Solution, Praj Industries, MTNL, Star Cement, Raymond, Ramco Systems, Time Technoplast, Mahanagar Gas, Precision Camshafts, Jubilant Life Sciences, Zensar Technologies, Inox Leisure, Aegis Logistics, Shemaroo Entertainment, Anant Raj, GHCL, Setco Automotive and Amrutanjan Health, among others.

Friday’s most active stocks in value terms

Bajaj Finance (Rs 3712.14 crore) , RIL (Rs 2471.02 crore) , HDFC Bank (Rs 2081.86 crore) , Infosys (Rs 1926.04 crore) , IndusInd Bank (Rs 1661.31 crore) , ITC (Rs 1437.61 crore) , Axis Bank (Rs 1378.65 crore) , TCS (Rs 1319.93 crore) , ICICI Bank (Rs 1215.29 crore) and Vodafone Idea (Rs 1128.77 crore) were among the most active stocks on Dalal Street on Friday in value terms.

Friday’s most active stocks in volume terms

Vodafone Idea (shares traded: 109.27 crore) , BHEL (shares traded: 9.04 crore), Ashok Leyland (shares traded: 7.58 crore), ITC (shares traded: 7.19 crore) , Tata Motors (shares traded: 5.63 crore) , UCO Bank (shares traded: 5.19 crore) , SBI (shares traded: 4.92 crore) , Indian Oil Corp (shares traded: 4.65 crore) , Indiabulls Housing Finance (shares traded: 4.61 crore) and Tata Power (shares traded: 4.60 crore) were among the most traded stocks in the session.

Stocks seeing buying interest

IOB, Ruchi Soya Industries, Alok Industries, Omaxe and Gujarat Gas witnessed strong buying interest from market participants as they scaled their fresh 52-week highs on Friday signalling bullish sentiment.

Stocks seeing selling pressure

B.C. Power Controls and Touchwood Entertainment witnessed strong selling pressure in Friday’s session and hit their 52-week lows, signalling bearish sentiment on these counters.

Sentiment meter favours bulls

Overall, market breadth remained in favour of bulls. As many as 260 stocks on the BSE 500 index settled the day in green, while 240 settled the day in red.

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[Source – Economic Times]

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