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

MUMBAI: Nifty50 on Tuesday formed a strong bullish candle on the daily chart, as the benchmark closed higher for the fifth successive session, marking its longest winning streak in recent months.

Here’s how analysts read the market pulse:

Rohit Singre, Senior Technical Analyst at LKP Securities said The index has shifted its immediate support to 18,100-18,040 zone so existing longs can be held with keeping trailing stop loss level below 18,000 mark.

Mazhar Mohammad of said Wednesday’s bullish gap area of 18,050-18,008 should act as a critical support in the short term. “Moreover, the strong upsurge is looking like some kind of consolidation breakout on the line chart after several days of sideways move,” he said.

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

Tech stocks lift Nasdaq

The Nasdaq rose on Wednesday as technology stocks returned as market favorites amid concerns about rising inflation, while banking stocks slipped despite strong quarterly results from JPMorgan. At 10:01 a.m. ET, the Dow Jones Industrial Average was down 163.31 points, or 0.48 per cent, at 34,215.03, the S&P 500 was down 7.03 points, or 0.16 per cent, at 4,343.62, and the Nasdaq Composite was up 52.60 points, or 0.36 per cent, at 14,518.53.

European shares climb

London’s FTSE 100 index edged higher by 0.16 per cent on Wednesday to hit 7,141.82, while the broader STOXX Europe 600 index climbed 0.77 per cent to 460.73

Tech View: Create long positions

Analysts said Nifty50 is still in the medium-term uptrend of 18,600-18,800 points. They said any dip near the above-mentioned support zone will be a fresh buying opportunity for the overall targets of 18,300-18,500 zone.

F&O: Buy on dips may continue

The overall comparative lower VIX reading suggests any small decline could be bought and the bulls are holding a tight grip on the market. Options data suggested a broader trading range between 17,700 and 18,500 levels while the immediate trading range existed between 17,850 and 18,300 levels.

Stocks showing bullish bias

Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade setup on the counters of ITC, Wipro, Hindalco Industries, Karur Vysya Bank and J&K Bank. 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 Alankit, Welspun India, Spencer’s Retail, Eveready Industries, VRL Logistics, Anant Raj, Cyient and Zota Healthcare. Bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.

Most active stocks in value terms

Tata Motors (Rs 9853 crore), Tata Power (Rs 6663 crore), Tata Chemicals (Rs 2300 crore), BHEL (Rs 2145 crore), Tatat Steel (Rs 1803 crore), M&M (Rs 1644 crore), IRCTC (Rs 1584 crore), Zee Entertainment (Rs. 1408), Avenue Supermarts (Rs. 1339) and TCS (Rs 1296 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

Tata Power (Shares traded: 30 crore), BHEL (Shares traded: 28.4 crore), Tata Motors (Shares traded: 19.8 crore), Vodafone Idea (Shares traded: 17.7 crore), IDBI Bank (Shares traded: 11.9 crore), Union Bank (Shares traded: 9.3 crore) and PNB (Shares traded: 8.3 crore) were among the most traded stocks in the session.

Stocks showing buying interest

Tata Motors, Tata Power, Tata Chemicals, Sona BLW Precision, Tata Investment, Angel Broking, and Timken India witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signaling bullish sentiment.

Stocks seeing selling pressure

Pasupati Acrylon, Nandini Creation and Aditya Birla Sun Life AMC 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 297 stocks on the BSE500 index settled the day in the green, while 203 ended the day in the red.

Podcast: Are there more legs to the rally?
BSE Sensex settled 13-odd points below 60,750 adding more than 450 points during the day. Nifty50 gained 170 points to close above 18,160-mark for the first time. It was merely 2 points shy of 18,200 during the session. Among the broader markets, BSE midcap index outperformed, jumping 2 per cent whereas BSE smallcap index gained a per cent. Sensex has gained about 2,000 points in October thus far. Are there more legs to the rally?

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