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


MUMBAI: Nifty50 on Thursday formed a bullish candle on the daily chart as the benchmark index closed over the 18,300 mark and rose for the sixth consecutive session. The Indian stock market was closed for trading on Friday on account of Dussehra.

Here’s how analysts read the market pulse:-

Sachin Gupta of Choice Broking said daily momentum indicator Stochastic and MACD have shown positive crossover on the daily chart, which supports the bullish momentum. “At present, the index has immediate support at 18,050 level while an upside move is expected till 18,500 level,” Gupta said.

Mazhar Mohammad of Chartviewindia.in that the index appears to have decisively emerged out of its three-week consolidation range of 17,947-326 levels as it witnessed sustained buying after gap-ups in the last two trading sessions. “This seems to have opened up a fresh leg of upswing with higher targets present around 18,500 level,” he said.

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


US shares
US equity indices ended higher on Friday aided by strong September quarter earnings and a surprise rise in retail sales for September that strengthened optimism for economic recovery.

European shares
European equities closed higher led by strong earnings performance of corporate Europe and optimism for ongoing recovery in the economy. The region’s headline indices marked their best weekly gains in seven months.

Tech View: Breakout done, next stop 18,500
Analysts said that Thursday’s gains was a bullish sign as the index opened gap-up and still formed a bullish candle for the second successive day. Analysts said this rally can extend further and the 18,500 level is a possibility.

F&O: Sharp drop in VIX builds hope
India VIX fell over 2 per cent from on Thursday. The overall comparative lower VIX suggests the bulls are holding a tight grip on the market. Options data suggested an immediate trading range between 18,000 and 18,500 levels.

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade setup on the counters of PFC, Adani Ports, Infosys, CESC, ICICI Bank and Larsen & Toubro.

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 Coal India, HUDCO, NCC, Reliance Capital, Sanghi Industries, Astra Microwave, Confiddence Petroleum, Taj GVK, Amara Raja Batteries, Camlin Fine, Sobha, and Indo Count Industries. Bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.

Most active stocks in value terms
IRCTC (Rs 7663 crore), Tata Motors (Rs 5211 crore), Wipro (Rs 4245 crore), Mindtree (Rs 3612 crore), Infosys (Rs 3416 crore), Tata Power (Rs 2861 crore), TCS (Rs 2336 crore), ITC (Rs 2187 crore), Adani Ports (Rs 1574 crore) and HCL Tech (Rs 1306 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 highest trading turnovers in the day.

Most active stocks in volume terms
PNB (Shares traded: 12.8 crore), Tata Power (Shares traded: 12.7 crore), Trident (Shares traded: 11.9 crore), Vodafone Idea (Shares traded: 11.8 crore), Tata Motors (Shares traded: 10.4 crore), ITC (Shares traded: 8.5 crore), YES Bank (Shares traded: 8.2 crore), BHEL (Shares traded: 6.4 crore), SAIL (Shares traded: 6.0 crore) and Wipro (Shares traded: 5.9 crore) were among the most traded stocks in the session.

Stocks showing buying interest
Network18, IRCTC, NLC India, BEML and HLIE Glasscoat witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signaling bullish sentiment.

Stocks seeing selling pressure
Destiny Logistics, Pasupati Acrylon and Inventure Growth witnessed strong selling pressure and hit their 52-week lows, signaling bearish sentiment on these counters.

Sentiment meter favours bears
Overall, the market breadth remained in favour of the bulls. As many as 256 stocks on the BSE500 index settled the day in the green, while 244 settled the day in the red.

Podcast: Will Fed taper be the first big stop for D-Street bulls?
After minutes of the Federal Reserve Open Market Committee meeting released last week revealed that the central bank may announce tapering at its next meeting in November, market participants have been left worried. How serious is the threat to investors on Dalal Street? Will the taper tantrum lead to an abrupt end to the bull run? In today’s special podcast with independent market expert Rajiv Nagpal, we try to understand how any tapering of bond buying by the Fed impacts equity investors in India.



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