Daily Big Picture – Key Indices End at Record High

Today’s Action:

Strong global cues pushed key indices higher; broader market follows suit. Nifty (+0.2%), Sensex (+0.4%), Model portfolio (-0.05%) and MSI Ind 47 (+0.9%).

Daily Market Review:

The Indian market picked up from where it left off on Friday as both the Nifty and the Sensex closed at a record high.

Amid strong global cues, frontline indices observed a gap up opening and remained firm throughout the day.

Broader market indices also had a strong day as the Nifty Midcap and Smallcap advanced 0.5% and 0.2%, respectively.

The overall market breadth remained strong with gainers outnumbering losers in a ratio of 7:5 on the NSE.

On the sectoral front, top gainers were Nifty PSU Bank (+2.6%), Energy (+0.8%), and Bank (+0.7%). The top losers were Nifty Pharma (-1%), FMCG (-0.7%), and Realty (-0.6%).

The market direction remains unchanged at a Confirmed Uptrend with a low distribution day count of one on the Nifty and two on the Sensex. The Nifty Midcap and Smallcap are still in a Rally Attempt.

Current Outlook:

– Market environment conducive for purchases, but remain selective.

– Focus on fundamentally strong stocks breaking out of solid technical patterns.

– Stay disciplined and exercise sound buy and sell rules.

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How To Trade: IPO Bases Are Unusual But Can Result In Rich Gains

New issues don’t play by the usual rules.

Companies making initial public offerings tend to draw a lot of investor attention. This often results in unusual and brand-new chart patterns. Volatility can rise as investors size up the demand for the new stock. Yet there are opportunities in these cases, if you can spot the correct characteristics amid the price-and-volume action.

The framework of a good IPO base is simple. The decline from peak to low usually doesn’t top 20%, but most volatile markets have produced declines of up to 50%. The length is often less than five weeks and can be as short as seven days. These two factors alone make IPO bases wayward cousins compared with proper bases, such as the cup-with handle and flat base, which need at least five to seven weeks of work. Continue reading “How To Trade: IPO Bases Are Unusual But Can Result In Rich Gains”