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

    Synopsis

    Mazhar Mohammad of Chartviewindia.in advised traders to book profit if the index slips below the 16,480 level.

    Ahead of Market: 12 things that will decide stock action on TuesdayGetty Images
    India VIX moved up 3.60 per cent from 12.99 to 13.45 level. VIX moved up even after the market rise, as Call writers got trapped and most of the OTM and ATM strikes are witnessing a surge in volatility.
    New Delhi: Nifty50 on Monday gained for the sixth straight session and formed a bullish candle on the daily chart. Analysts said certain technical indicators continue to remain in the overbought territory and said some caution is warranted.

    Here's how analysts read the market pulse:

    Mazhar Mohammad of Chartviewindia.in advised traders to book profit if the index slips below the 16,480 level. "The recent Nifty50 rally from the low of 16,162 level to a high of 16,589 has dragged certain momentum oscillators into the overbought zone. Some caution is warranted on the part of the bulls," he said.

    Rohit Singre of LKP Securities said traders should use any dip to make fresh longs near 16,500-16,440.

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

    Wall St slips as China data sours mood
    The Dow and the S&P 500 slipped from record highs on Monday as glum data from China sparked fears of slowing global growth and hurt shares of sectors that are closely linked to the health of the U.S. economy. At 9:59 a.m. ET, the Dow Jones Industrial Average was down 264.26 points, or 0.74 per cent, at 35,251.12, the S&P 500 was down 26.38 points, or 0.59 per cent, at 4,441.62, and the Nasdaq Composite was down 117.42 points, or 0.79 per cent, at 14,705.47.

    European stocks snap 10-day rally
    A 10-day rally in European stocks came to a halt on Monday following a surprise slowdown in China's economic indicators, with commodity-linked stocks falling the most. The pan-European STOXX 600 index fell 0.5% to 473.45, easing from a record level scaled last week. Oil and mining stocks fell about 1.5% each as commodity prices took a hit after Chinese data raised concerns about faltering demand in the world's major consumer of metals and oil.

    Tech View: Nifty in overbought zone

    Nifty50 made higher highs and lows for the third day. Analysts said certain technical indicators continue to remain in the overbought territory and the broader market sentiment has not seen any recovery, with only two stocks falling for every one that rose. Some caution is warranted, they said. Shrikant Chouhan of Kotak Securities said that the index has formed a breakout continuation formation for the day. The texture of the chart, he said, suggests that the 16,450-16,400 range would act as key support for the day traders.

    F&O: Bulls are firmly placed
    India VIX moved up 3.60 per cent from 12.99 to 13.45 level. VIX moved up even after the market rise, as Call writers got trapped and most of the OTM and ATM strikes are witnessing a surge in volatility. Overall comparative lower volatility indicates that bulls are holding the command and momentum could continue. On the options front, maximum Put Open Interest stood at 16,000 levels followed by 16,500, while maximum Call OI was seen at 16,500 followed by 17,000 levels.

    Stocks showing bullish bias
    Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade setup on the counters of Tata Steel, GMR Infrastructure, Reliance Industries, NTPC, KNR Constructions, Bandhan Bank, Usha Martin, Banco Products, Apollo Tyres, Hindustan Zinc, L&T, Confidence Petroleum, Container Corporation, Indus Towers, Relaxo Footwears, Websol Energy System, TV Today Network, UTI AMC, Alembic Pharmaceuticals, Avenue Supermarts, Amrutanjan Health, Alphageo (India), Safari Industries, Aavas Financiers, Mold-Tek Packaging, Future Enterprises, AKG Exim and Abbott India.

    The MACD is known for signalling 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 ITC, ICICI Bank, Havells India, Radico Khaitan, Dollar Industries, Panama Petrochem, Ramkrishna Forgings, Kothari Petrochem, GNA Axles, Cosmo Films, GOCL Corporation, Sagar Cements, Surya Roshni Ltd, KSB, IIFL Wealth Management, Dynemic Products, Sangam India, Solara Active Pharma, Goldstone Tech, Solar Industries, D P Abhushan, Banka Bioloo, Sanofi India, WABCO India and JSW Holdings. A 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 4076.01 crore), RIL (Rs 2204.23 crore), Devyani International (Rs 1988.52 crore), Apollo Hospital (Rs 1590.17 crore), Bajaj Finance (Rs 894.08 crore), Laxmi Organic Industries (Rs 870.38 crore), Krsnaa Diagnostics (Rs 853.16 crore), Vedanta (Rs 824.11 crore), Infosys (Rs 777.66 crore) and SBI (Rs 752.91 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 the highest trading turnovers in the day.

    Most active stocks in volume terms
    Vodafone Idea (Shares traded: 18.02 crore), MPS Infotecnics (Shares traded: 16.80 crore), Devyani International (Shares traded: 15.24 crore), YES Bank (Shares traded: 6.33 crore), JP Power (Shares traded: 4.95 crore), Trident (Shares traded: 4.78 crore), SAIL (Shares traded: 4.43 crore), Suzlon Energy (Shares traded: 4.20 crore), Tata Steel (Shares traded: 2.71 crore) and BHEL (Shares traded: 2.64 crore) were among the most traded stocks in the session.

    Stocks showing buying interest
    Devyani International, Laxmi Organic Industries, Fortis Healthcare, Sun Pharma Advanced Research and Apollo Hospital witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signalling bullish sentiment.

    Stocks seeing selling pressure
    Aurobindo Pharma and YES Bank witnessed strong selling pressure and hit their 52-week lows, signalling bearish sentiment on these counters.

    Sentiment meter favours bears
    Overall, the market breadth remained in favour of the bears. As many as 157 stocks on the BSE500 index settled the day in the green, while 342 settled the day in the red.

    Podcast: Is the party in the primary market over?
    Four stocks made their debut on Dalal Street today and three of them saw tepid listing gains. Is the party in the primary market over? Will Nifty continue to show strength at higher levels? What do the technical charts suggest?



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    (What's moving Sensex and Nifty Track latest market news, stock tips and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .)

    Download The Economic Times News App to get Daily Market Updates & Live Business News.

    Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.

    Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

    ...more
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