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

Indian stocks have been in a recovery mode since the last three weeks as investors have bought dips following upbeat results from India Inc in the last quarter.

Analysts also believe this is the right time to pick quality stocks at cheaper valuations, despite rising inflationary worries and looming recession fears.

Here's how analysts read the market pulse:
Gaurav Ratnaparkhi of Sharekhan said the index could not gather follow through momentum after a firm start. "It crossed the barrier of 16,700 with a gap-up opening, but stumbled near the daily upper Bollinger Band, which was near 16,800."

Yesha Shah of Samco Securities said the index is expected to give an immediate resistance breakout, indicating continuance of the bullish short-term trend.

"While short-term texture of the market is still on the bullish side, on weekly charts the Nifty has formed a Hammer candlestick formation, which is indicating further weakness from the current levels," said Amol Athawale of Kotak Securities.

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

Wall St ends down
Wall Street's three major stock indexes ended lower on Friday after a solid jobs report ate in to hopes for a pause in the Federal Reserve's aggressive policy-tightening which is needed to cool decades-high inflation

European shares end week lower
The pan-European STOXX 600 index fell 0.3% with volumes expected to be subdued due to holidays in Britain and China. It ended the tumultuous week 0.9% lower.

Tech View: Long bearish candle
Nifty50 on Friday erased intraday gains to end lower, forming a long bearish candle on the daily chart. On the weekly scale, it formed a small bullish candle with a long upper wick, suggesting selling pressure at higher levels. Analysts see support at 16,400 while they see resistance at 17,000 level.

F&O: Support at 16,450-16,400
16,750-16,850 will be seen as a major resistance zone now and the immediate support is placed around 16450-16400. Once this support is breached, our markets could go correct towards 16200-16000 in a short period of time, said Ruchit Jain, Lead Research, 5paisa.com.

"Traders should also be vigilant on the global markets and the US Dollar index which has shown signs of an up move again after the recent corrective phase," he added.

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade setup on the counters of ONGC, Indian Oil Corp, NMDC, OnMobile Global, Lupin, Aptech, JBM Auto, RSWM and Nahar Industries,

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 Kotak Mahindra Bank, Marico, Gokaldas Exports, Colgate Palmolive, Sharda Cropchem, Home First Finance and Coromandel International. 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 3086.14 crore), Infosys (Rs 1,447.62 crore), Ultratech Cement (Rs 1,278.15 crore), HDFC (Rs 682.49 crore), TCS (Rs 662.42 crore), Grasim Industries (Rs 653.92 crore) and ICICI Bank (Rs 642.32 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 highest trading turnovers in the day.

Most active stocks in volume terms
Coal India (Shares traded: 2.53 crore), ONFC (Shares traded: 1.67 crore), NTPC (Shares traded: 1.41 crore), Tata Motors (Shares traded: 1.28 crore), ITC (Shares traded: 1.25 crore), Hindalco (Shares Traded: 1.22 crore) and Power Grid (Shares traded: 1.2 crore) were among the most traded stocks in the session on NSE.

Stocks showing buying interest
Ratnamani Metal & Tubes witnessed strong buying interest from market participants as it scaled their fresh 52-week highs, signaling bullish sentiment.

Stocks seeing selling pressure
Ramco Cements, Dalmia Bharat, JK Cement, Hikal, Grasim Industries, Ultratech Cement and Shree Cement witnessed strong selling pressure and hit their 52-week lows, signaling bearish sentiment on the counters.

Sentiment meter favours bulls
Overall, market breadth favoured losers as 1,308 stocks ended in the green, while 2,029 names settled with cuts.

Podcast: Which sectors to bet on after Q4 results?
In today's special podcast with independent market expert Rajiv Nagpal, lets try to understand how Nifty companies fared in Q4 earnings and key takeaways for investors.