Ahead of Market: 12 things that’ll decide Monday’s stock action


As Nifty ended marginally higher on Friday, it formed a small bullish candle on the daily chart. Rajesh Palviya of Axis Securities said the index is trading above 20- and 50-day simple moving averages, which are important short-term signals.

“A long lower shadow on the weekly scale is indicating buying at lower levels. The index is moving in a higher top and higher bottom formation on the weekly chart, indicating a sustained up- trend. If Nifty crosses and sustains above 11,500 level, it would trigger buying and that may lead the index towards the 11,600-11,800 zone. If the index breaks below 11,300 level, it may fall towards the 11,200-11,000 zone,” he said.

Vinod Nair of Geojit Financial Services said uncertainty over border tensions may keep investors worried in the short term. “Lack of any fresh domestic triggers means investors will continue to watch global cues for directional cues next week,” he said.

Nagaraj Shetti of HDFC Securities said even as the index has moved above 20-EMA, the uptrend line is still acting as a hurdle at 11,520 as per the concept of change in polarity. “Hence, a sustainable move above 11,550 level could open renewed buying enthusiasm in the market,” he said.

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

Nasdaq Slips More, Dow Up
Nasdaq fell in another volatile session on Friday, as the continuing tech selloff drove it to its worst week in months. The index closed 0.6% lower at 10,853. But the S&P500 eked out a small gain after gyrating between solid gains and steep losses. It closed about 0.1% higher at 3,340. Dow ended the day 131.06 points, or 0.5%, higher at 27,665.

European Shares Mildly Up on Friday

European equities on Friday posted their biggest weekly gain since early last month, capping a roller-coaster week, with Altice Europe NV and Aryzta AG jumping on takeover news. The STOXX Europe 600 Index ended the session up 0.13 per cent at 367.96, with a slump in banks and travel shares offset by a surge in mining stocks. FTSE rose 0.5 per cent, CAC 0.2 per cent while DAX fell 0.1 per cent.

Tech View: Nifty Forms Small Bullish Candle

Nifty50 edged higher on Friday, and formed a small bullish candle on the daily chart and a Hammer-like candle on the weekly scale. The index stayed above its 20-day exponential moving average (EMA) of 11,382, which analysts said is a positive signal. The index also formed a higher high and low for the second day, which adds to the sentiment. As long as the index holds above the 11,200-11,300 range, the index may drift towards the 11,500-11,650 range, say analysts.

F&O: India VIX Slips Further to 21.26
India VIX fell 2.58 per cent from 21.26 to 20.71 level. The VIX has seen the lowest closing level of the week, but needs to cool down further below 20-18 levels, to help the bulls get a grip and kick off the next leg of the rally. Options data suggested a wider trading range between 11,200 and 11,700 levels.

Stocks Showing Bullish Bias
Momentum indicator Moving Average Convergence Divergence (MACD) on Friday showed bullish trade setup on the counters of Grasim Industries, Dabur India, NCL Industries, InterGlobe Aviation, Sequent Scientific, SBI Life Insurance, Berger Paints, Aditya Birla Money, Andhra Cement, Century Enka, Goldiam International, Madhav Marbles, Onward Technologies, Celebrity Fashions, Bedmutha Industries and Prataap Snacks, among others.

Stocks Signalling Weakness Ahead

The MACD showed bearish signs on the counters of Zee Entertainment, Amber Enterprises, Central Depository, United Breweries, Automotive Stampings, Finolex Industries, Mahamaya Steel Industries, Johnson Controls-Hit and IMP Powers, among others,

Friday’s Most Active Stocks

RIL (Rs 6,361.42 crore) , Bajaj Finance (Rs 1621.42 crore) , Amber Enterprises India (Rs 1270.44 crore) , Wipro (Rs 1231.15 crore) , HDFC Bank (Rs 1126.16 crore) , Maruti Suzuki (Rs 1002.29 crore) , TCS (Rs 981.26 crore) , SBI (Rs 968.99 crore) , Tata Motors (Rs 939.76 crore) and ICICI Bank (Rs 837.01 crore) were among the most active stocks on Dalal Street on Friday in value terms.

Friday’s Most Active Stocks in Volume Terms

Vodafone Idea (shares traded: 22.37 crore) , YES Bank (shares traded: 14.74 crore) , Tata Motors (shares traded: 6.51 crore) , SBI (shares traded: 4.85 crore) , Uttam Value Steel (shares traded: 4.32 crore) , Wipro (shares traded: 4.19 crore) , Ashok Leyland (shares traded: 2.86 crore) , SAIL (shares traded: 2.77 crore) , RIL (shares traded: 2.74 crore) and IDFC First Bank (shares traded: 2.73 crore) were among the most traded stocks in the session.

Stocks Seeing Buying interest
Max Healthcare Institute, Strides Shasun , NIIT Tech, SBI Card and Wipro witnessed strong buying interest from market participants as they scaled their fresh 52-week highs on Friday signalling bullish sentiment.

Stocks Seeing Selling Pressure
Kuantum Papers witnessed strong selling pressure in Friday’s session and hit its 52-week lows, signalling bearish sentiment on the counter.

Sentiment Meter Favours the Bulls
Overall, market breadth remained in favour of bulls. As many as 267 stocks on the BSE 500 index settled the day in green, while 227 settled the day in red.

Podcast: Decoding Multicap Fund Rule Change
With bleak projections for the economy and market driving cues drying up, will the bears return to rule D-Street? And what is in it for you in the new Sebi norms for multicap fund? Listen in.


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