Here’s a look at what some of the key indicators are suggesting for Friday's action.
Analysts said supports are moving higher gradually, but Nifty is facing hurdles at higher levels.
NEW DELHI: Nifty ended above the 11,200 level on Thursday forming a bullish candle on the daily chart. With this, the index is now trading above all its key moving averages, and there is no indication of weakness anywhere.
Vinod Nair of Geojit Financial Services said liquidity seems to be driving up the market. Every dip is getting bought into and they are being short-lived, especially in the current mood of the market, which is overlooking all the negatives.
Ajit Mishra of Religare Broking said the market is currently riding high on better-than-expected earnings and upbeat global markets. “Considering the momentum, Nifty might test the 11,350 level soon. Traders should align their trades accordingly, but we suggest preferring hedged trades,” he said.
Chandan Taparia of Motilal Oswal Securities said support for Nifty50 is gradually shifting higher. “The index has been respecting its rising support trend line by connecting all the recent swing lows. It is also holding above its 200-day EMA. As long as Nifty holds above 11,100 level, it could extend its momentum towards 11,333 and 11,500. Supports for the index are now seen at 11,050 and 11,000 levels," he said.
That said, here’s a look at what some of the key indicators are suggesting for Friday's action: US stocks fall as labor market rebound slows The S&P 500 struggled for direction on Thursday, following four straight days of gains as investors held out for a new coronavirus relief package, with latest data showing signs that a recovery in the labor market was stalling. The Dow Jones Industrial Average was down 51.44 points, or 0.19%, at 26,954.40, the S&P 500 was up 1.32 points, or 0.04%, at 3,277.34. The Nasdaq Composite was up 6.20 points, or 0.06%, at 10,712.33.
Upbeat earnings lift European stocks European shares climbed on Thursday, as investors brushed off simmering U.S.-China tensions and focused on better-than-expected earnings reports from companies such as Unilever, Daimler and Publicis. The pan-European STOXX 600 index rose 0.7%
Tech View: Nifty negates Hanging Man candle Nifty50 resumed its upward trend on Thursday, negating a ‘Hanging Man’ candle formed on the previous day, which required follow-through selling. The index made a higher highs and lows and the consolidation range of 10,900-11,250 has remained intact. Analysts said supports are moving higher gradually, but Nifty is facing hurdles at higher levels.
F&O: Lower VIX level supporting bulls India VIX fell 0.96 per cent to 24.64. Overall lower volatility is supporting the bullish scenario, and every intraday decline is getting bought into. Options data suggested a shift in trading range between 11,000 and 11,400 levels.
Stocks showing bullish bias Momentum indicator Moving Average Convergence Divergence (MACD) on Thursday showed bullish trade setup on the counters of SBI, GMR Infrastructure, National Fertilizers, Indraprastha Gas Ltd, BEML, Dilip Buildcon, SMS Pharmaceuticals, Natco Pharma, Nelco, Can Fin Homes, City Union Bank, HSIL, Time Technoplast, Hikal, Mirza International, Archidply Industries, Essel Propack, Jayshree Tea, Eicher Motors, Indian Hume Pipe, Gulf Oil Lubricants, JK Cement, Career Point, Precision Wires, M Forgings, Schaeffler India and Vardhman Holdings, among others.
Stocks signalling weakness ahead The MACD showed bearish signs on the counters of Jindal Steel & Power, Hindustan Unilever, Tata Steel BSL, Hero MotoCorp, Sadbhav Engineering, Kaveri Seed Company, Gateway Distriparks, Aditya Birla Money, eClerx Services, L&T Technology Services, Gulshan Polyols, Ramco Industries, Timken India, Mahindra Logistics, Hinduja Global Solutions, Chemfab Alkalis, TCPL Packaging, DIC India and Tainwala Chem. Bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.
Most active stocks in value terms RIL (Rs 5479.32 crore) , Bajaj Finance (Rs 2865.95 crore) , Rossari Biotech (Rs 2585.33 crore) , Axis Bank (Rs 1870.69 crore) , BPCL (Rs 1693.76 crore) , ICICI Bank (Rs 1458.24 crore) , SBI (Rs 1386.77 crore) , Infosys (Rs 1183.84 crore) , HDFC Bank (Rs 1141.21 crore) and ZEEL (Rs 1060.96 crore) were among the most active stocks on Dalal Street on Thursday in value terms.
Most active stocks in volume terms YES Bank (shares traded: 45.19 crore) , Vodafone Idea (shares traded: 23.16 crore) , SBI (shares traded: 7.08 crore) , Uttam Value Steel (shares traded: 6.54 crore) , ZEEL (shares traded: 6.52 crore) , Federal Bank (shares traded: 4.62 crore) , Indian Oil Corp (shares traded: 4.49 crore) , Axis Bank (shares traded: 4.02 crore) , ICICI Bank (shares traded: 3.78 crore) and BPCL (shares traded: 3.65 crore) were among the most traded stocks in the session.
Stocks seeing buying interest RIL, Natco Pharma, Laurus Labs, PI Industries and Granules India witnessed strong buying interest from market participants as they scaled their fresh 52-week highs on Thursday signalling bullish sentiment.
Stocks seeing selling pressure Aarti Surfactants, B.C. Power Controls, Borosil and Mittal Life Style witnessed strong selling pressure in Thursday’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 300 stocks on the BSE 500 index settled the day in green, while 195 settled the day in red.
Podcast: What’s holding the fort on Dalal Street?>>>
While abundant liquidity seems to be driving the markets and every dip is getting bought into, how should investors approach stocks now, especially when the market has been consistently overlooking the negatives?
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