Market status: Confirmed Uptrend

Distribution Day: Two

Global stock markets: Dow30, +0.2%, S&P500,+0.2%, Nasdaq,-0.1%, Nikkei, +0.2%; Kospi, +0.3%; Hang Seng, +0.3%

Yesterday, Nifty opened on a flat-to-positive note and quickly turned negative. It moved in a narrow range in the first half of the session. In the second half, it was highly volatile, with selling pressure followed by buying, which helped Nifty close in the green. In the broader market, Nifty Midcap was up 0.5%, while Nifty Smallcap closed flat for the day. On the sectoral front, barring financial-related sectoral indices, all the indices closed in the green. Nifty Realty (+2.9%) and Metal (+2.6%) were the major advancers. Market breadth was inclined toward advancers.

We are in a Confirmed Uptrend but need to be prudent and cautious while adding fresh positions, as Nifty is currently trading ~20% above its 200-DMA, which is rare. We might expect some pullback in the market. However, a small pullback/consolidation is a constructive sign if Nifty holds its 21-DMA. It is advised to closely review the existing positions and book partial profits in stocks that are extended from their moving averages. We will look for leadership among some good stocks to push the market up. On the flip side, tracking distribution days is crucial. An accumulation of distribution days can halt the uptrend.

Key News

Yesterday, the FIIs bought equities worth Rs 357.4 crore, while the DIIs sold equities worth Rs 1,636 crore.

Apollo Hosps.Enterprise got the board’s approval to raise funds worth Rs 1,500 crore in one or more tranches.

Wipro (Nse) bagged a multi-year contract deal from Verifone for its cloud services.

O’Neil Market Condition Report

For the 24 emerging markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 72%; RallyAttempt, 8%; Uptrend Under Pressure, 20%; Downtrend, 0%.

For the 24 developed markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 88%; RallyAttempt, 0%; Uptrend Under Pressure, 12%; Downtrend, 0%.

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Author's Bio: 

Marketsmith India, One stop solution for all your Stock Market needs. Get stock market ideas and stock predictions all at one place. A proprietary tool by William O'Neil India following the CANSLIM method of investing.