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

NEW DELHI: Nifty erased some of the intraday gains but ended above the 12,750 level on the special Muharat trading session on Saturday.

Aditya Agarwala of YES Securities said that the index has entered a sideways phase.

"Nifty is approaching an upper end of a major rising channel placed at 12,850-12,900. A failure to take out this resistance can trigger profit booking in the coming trading weeks," he said.

Nirali Shah, senior research analyst, Samco Securities, said, the index has become overbought and a profit-booking move cannot be ruled out and advised traders to keep a buy on dips approach unless the Nifty50 does not break below the rising channel on the weekly chart.

Gaurav Ratnaparkhi of Sharekhan by BNP Paribas said, the laggards like banking and financial services saw a good amount of traction in the run up to the Muharat trading session.

"They were one of the major contributors to the index on the Muhurat trading day as well. The overall structure shows that this space has a lot of ground to cover on the upside and can continue to witness buying interest going ahead," he said.

That said, here’s a look at what some of the key indicators are suggesting for Tuesday's action:
US stocks rise as vaccine hopes firm
Wall Street's main indexes rose on Monday after Moderna became the second US company in a week to report positive results from its COVID-19 vaccine trial, raising hopes of a quicker economic recovery from a pandemic-led recession. The Dow Jones Industrial Average rose 360.47 points, or 1.22%, to 29,840.28, the S&P 500 gained 29.36 points, or 0.82%, to 3,614.51 and the Nasdaq Composite gained 67.22 points, or 0.57%, to 11,896.50.

European shares at eight-month high on vaccine optimism
European shares shot up to a more-than-eight-month high on Monday, after Moderna Inc became the second drugmaker in a week to report high efficacy for an experimental coronavirus vaccine. The pan-European STOXX 600 traded 1.31% higher after Moderna announced that its vaccine appeared to be highly effective. Pfizer made a similar announcement on Nov. 9.

Tech View: Nifty50 respects the five-day EMA
Nifty50 on Friday saw buying at the day’s low level before eventually ending the day higher. The index formed a small bullish candle on the daily chart. Analysts said the index is moving sideways and any rise towards the 12,900 level could attract selling pressure. Sacchitanand Uttekar of Tradebulls Securities said the index respected its five-day exponential moving average (EMA) as it witnessed a strong recovery from the intraday low of 12,607.

Check out the candlestick formations in the latest trading sessions

ETMarkets.com

F&O: Volatility cools down significantly
India VIX slipped 4.45 per cent from 20.62 to 19.70 levels. Volatility has significantly cooled down and needs to be at lower levels to ride the momentum with a higher market base. Marginal Call writing was seen at strike price 12,900, while there was Put writing at 12,100 and 12,500 levels. Options data suggested a wider trading range between 12,400 and 13,000 levels.



Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade setup on the counters of Infosys, Bharti Infratel, Century Plyboards, Vertoz Advertising, Tata Coffee, Rico Auto Industries, Redington (India), Skipper, Nectar Lifesciences, Gujarat Pipavav Port, Uflex, Kajaria Ceramics, ICICI Securities, Globus Spirits and Eros International among others.

Stocks signalling weakness ahead
The MACD showed bearish signs on the counters of Camlin Fine Sciences, Shashijit Infraprojects, APL Apollo Tubes, Alkali Metals, Pilani Investments, Prismx Global Ventures, Crest Ventures, Aro Granite Industries, TCI Developers and TCFC Finance among others.

Most active stocks in value terms
RIL (Rs 483.82 crore), Tata Steel (Rs 387.28 crore), Bajaj Finance (Rs 347.20 crore), BPCL (Rs 345.29 crore), Eicher Motors (Rs 266.46 crore), IndusInd Bank (Rs 252.47 crore), Bajaj Finserv (Rs 233.15 crore), Vodafone Idea (Rs 224.65 crore), Axis Bank (Rs 197.52 crore) and Bharti Airtel (Rs 190.17 crore) were among the most active stocks on Dalal Street in value terms.

Most active stocks in volume terms
Vodafone Idea (shares traded: 24.88 crore), YES Bank (shares traded: 6.62 crore), SITI Networks (shares traded: 2.09 crore), Uttam Value Steel (shares traded: 2.08 crore), NTPC (shares traded: 1.25 crore), Tata Motors (shares traded: 1.17 crore), IDFC First Bank (shares traded: 0.98 crore), BPCL (shares traded: 0.84 crore), Indiabulls RE (shares traded: 0.80 crore) and Tata Steel (shares traded: 0.78 crore) were among the most traded stocks in the session.

Stocks seeing buying interest
Ratnamani Metal, Tata Steel (PP), Tanla Solutions, Blue Dart Express and Chambal Fertilizers witnessed strong buying interest from market participants as they scaled their fresh 52-week highs signalling bullish sentiment.

Stocks seeing selling pressure
WABCO India, D. P. Abhushan, Sanginita Chemicals and Vishal Fabrics witnessed strong selling pressure 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 410 stocks on the BSE 500 index settled the day in green, while 84 settled the day in red.

Podcast: Why are FIIs buying stocks with both hands? >>>

It was another solid week for D-Street, wherein not only did the benchmark indices end Samvat 2076 on a high, but also posted considerable gains during Muharat trading on the ocassion of Diwali. Strong FII flows, news on the Covid vaccine front and ending of US election uncertainty fuelled the rally in stocks. Sensex closed 195 points, or 0.45 per cent higher at 43,638, while Nifty gained 51 points to 12,771. We spoke to independent market expert Rajiv Nagpal to understand what's fuelling FII interest in Indian market.