Ahead of Market: 10 things that will decide D-St action on Thursday

NEW DELHI: Traders on Dalal Street were nervous ahead of the Fed meeting outcome later at night. Volumes on NSE were lower than usual as traders chose to wait and watch what Fed Chair Powell would say after the FOMC meeting. Nifty opened flat and traded in a narrow range to finally close with a loss of 40 points at 15,692 levels.

Here's how analysts read the market pulse:

Nagaraj Shetti, Technical Research Analyst, HDFC Securities, said the short-term trend of the Nifty continues to be weak with range-bound action. “Such lack of strength at the important support signal chances of false downside breakout or one leg of downside before showing sharp upside bounce from the lows of around 15,500 levels in the short term. Immediate resistance is at 15,780,” he said.

Kunal Shah, Senior Technical & Derivative Analyst at LKP Securities, said Nifty’s lower-end support stands at 15,500, where fresh Put writing has been observed, and if it fails to sustain above that, it will witness further selling pressure. “The upper-end resistance stands at 16,000 where the highest open interest is built up on the call side.”

That said, here’s a look at what some key indicators are suggesting for Thursday’s action:

Wall Street rallies before Fed's rate decision
US stocks are rallying Wednesday, on track for their first gain in six days, but more turbulence may be ahead when the Federal Reserve announces in the afternoon how sharply it’s raising interest rates.

The S&P 500 was 0.9% higher as investors ready for the Fed’s rate hike, which most investors expect to be triple the usual amount and the sharpest since 1994. The Dow Jones Industrial Average was up 208 points, or 0.7%, at 30,574, as of 11:04 a.m. Eastern time, and the Nasdaq composite was 1.5% higher.

European markets close higher
European stocks closed higher on Wednesday as global markets watched monetary policy moves from several major central banks. The pan-European Stoxx 600 provisionally closed up by 1.5% as almost all sectors and major bourses entered positive territory.

Tech View: Nifty respecting support of 15,671
Nifty50 formed a small bearish candle on the daily chart, with a long upper wick, reflecting selling at highs. Analysts said the index has been respecting its support of 15,671 on a closing basis and as long as it keeps respecting that, chances of some bounce cannot be ruled out. They see support shifting to 15,400-300 levels if the level is breached.

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed a bullish trade setup on the counters of VIP Industries, Tube Investments, Grasim, IPCA Labs and Alembic Pharma.

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 Engineers India, Dixon Tech, TVS Motor, Sterlite Tech, Avenue Supermart and HPCL. A bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.

Most active stocks in value terms
Reliance Industries (Rs 1,350 crore), HDFC (Rs 913 crore), Bajaj Finance (Rs 905 crore), Tata Steel (Rs 889 crore), HDFC Bank (Rs 772 crore), and Infosys (Rs 665 crore) were among the most active stocks on NSE in value terms. Higher activity on a counter in value terms can help identify the counters with the highest trading turnovers in the day.

Most active stocks in volume terms
ONGC (Shares traded: 1.6 crore), Tata Motors (Shares traded: 1.5 crore), NTPC (Shares traded: 1.5 crore), SBI (Shares traded: 99 lakh), Tata Steel (Shares traded: 92 lakh) and ICICI Bank (Shares traded: 92 lakh) were among the most traded stocks in the session on NSE.

Stocks showing buying interest
Shares of Varun Beverages witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signaling bullish sentiment.

Stocks seeing selling pressure
Tata Steel, Tech Mahindra, Hindalco and BPCL witnessed strong selling pressure and hit their 52-week lows, signalling bearish sentiment on the counters.

Sentiment meter favours bulls
Overall, market breadth favoured winners as 1,746 stocks ended in the green, while 1,561 names settled with cuts.