NEW DELHI: Following a gap-up opening on Friday, domestic headline equity index Nifty broke out the 14,800 level but traded range-bound. The index formed an indecisive 'Doji' candle on the daily chart but a long bullish candle was formed on the weekly scale.
Ashis Biswas, Head of Technical Research at CapitalVia Global Research said, "The market witnessed extension in the trend that started on Thursday after Nifty50 breached the important level of 14,700. The rally might continue till the level of 14,900. Though it is subject to further price action but if the market breaks the level of 14,900 and sustains above the said level, we'll see a new bullish rally till the levels of 15,200."
That said, here’s a look at what some of the key indicators are suggesting for Monday's action:
US stocks end at record high
The Dow and S&P 500 hit record closing highs on Friday while registering gains for the week, and the Nasdaq recovered after U.S. jobs data eased concerns over prospects for rising rates. The Dow Jones rose 0.66%, the S&P 500 gained 0.74%, and the Nasdaq Composite added 0.88%. For the week, the Dow rose 2.7%, its biggest weekly percentage gain since March. The S&P 500 gained 1.2%, its best week since mid-April, while the Nasdaq shed 1.5%.
European stocks end at record high on strong German data, earnings
European stocks closed at a record high on Friday, marking strong weekly gains as positive economic data and upbeat earnings underpinned hopes of a swift economic recovery from the COVID-19 pandemic. The pan-European STOXX 600 index rose 0.9%% to a record high of 444.93 points. It added 1.7% this week- its best performance since mid-March. The German DAX rose 1.3%, inching closer to its lifetime high, while France’s CAC 40 ended at its highest level since November 2000 and UK’s FTSE 100 breached the 7,100 mark for the first time since February 2020.
Tech View: Nifty looks bullish, but has a cluster of hurdles ahead
Aditya Agarwala of YES Securities said the bulls have taken Nifty beyond key short-term moving averages of 20-DMA and 50-DMA, suggesting intermediate bullishness. But Nifty is approaching a key resistance hurdle in the 14,900-15,000 zone, which is a cluster of previous highs and a downtrend line. He said these levels need to be watched out for.
ETMarkets.comIndia VIX fell 5.52 per cent from 22.03 to 20.82 level. The fear gauge needs to hold below 20 level to again attract a bullish stance. On the options front, maximum Put Open Interest stood at 14,000 level followed by 13,500, while maximum Call OI was seen at 15,000 level followed by 15,500. Call writing was seen at strike price 15,500 while there was Put writing at 14,000 and then 14,700 levels. Options data suggested a wider trading range between 14,400 and 15,200 levels, while an immediate trading range was seen in the 14,600 -15,000 zone.
Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) on Friday showed bullish trade setup on the counters of ITC, Glenmark Pharma, Edelweiss Financial Services, Eris Lifesciences, IRB Infra, Escorts, Adani Transmission, Amara Raja Batteries, Kalpataru Power, Zensar Tech, IIFL Finance and Colgate Palmolive.
The MACD is known for signalling trend reversals in traded securities or indices. When the MACD crosses above its 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 Rain Industries, Dr. Reddy's Labs, OnMobile Global, CSB Bank, DCM Shriram, PI Industries, Orient Refractories, Vimta Labs, Pfizer, Brooks Laboratories, Atul Ltd and Cera Sanitaryware. Bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.
Friday's most active stocks
Tata Steel (Rs 6,291.73 crore), SAIL (Rs 2,327.50 crore), JSW Steel (Rs 1,996.01 crore), Hindalco (Rs 1,836.12 crore), Adani Ports SEZ (Rs 1,586.15 crore), SBI (Rs 1,370.17 crore), Tata Motors (Rs 1,261.63 crore), HDFC (Rs 1,193.52 crore), Coforge (Rs 1,157.61 crore) and SBI Life (Rs 1,100.69 crore) were among the most active stocks on Dalal Street on Friday in value terms.
Friday's most active stocks in volume terms
SAIL (Shares traded: 16.49 crore), Reliance Power (Shares traded: 15.21 crore), NALCO (Shares traded: 14.27 crore), South Indian Bank (Shares traded: 13.93 crore), Yes Bank (Shares traded: 12.10 crore), PNB (Shares traded: 11.10 crore), Vodafone Idea (Shares traded: 10.86 crore), Trident (Shares traded: 8.14 crore), BHEL (Shares traded: 8.13 crore) and Reliance Communication (Shares traded: 5.45 crore) were among the most traded stocks in the session.
Stocks showing buying interest
BSE, Happiest Minds, KSB, Lupin, Marico, UTI AMC, Wipro, NALCO, Hindustan Copper and NMDC witnessed strong buying interest from market participants as they scaled their fresh 52-week highs on Friday, signalling bullish sentiment.
Stocks seeing selling pressure
Best Agrolife, Isgec Heavy Engineering, Niraj Cement, Sundaram Finance RE, Suryoday SFB, Suvidhaa Infoserve and Jump Networks witnessed strong selling pressure in Friday’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 273 stocks on the BSE 500 index settled the day in green, while 222 settled the day in red.
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