Daily Market Review
Market Pulse: Downtrend
Markets ripped higher in the final hour to close near the high of day’s range. After closing in negative territory for seven consecutive sessions, Nifty rallied strongly. However, volatility continued to remain high. Today is the first day of our rally attempt as Nifty closed higher. Hereon, we will look for today’s low (11,153) to hold for another two days before changing the market status to a Rally Attempt. If that happens, we will be looking for a follow-through day.
It is important to understand that the market’s selloff has been so sharp and deep that it is a reasonable possibility that we have a sharp bounce like that of today. One should not get deceived by these moves. Instead, wait for the market to show some strength and stage a follow-through day. Sharp, V-shaped recoveries are generally not constructive because most stocks can be hampered by overhead supply issues and that can cause a repulse.
On the sectoral front, all sectors closed in the green. Nifty Media (+5.8%) and Metals (+5%) were leading. Nifty Auto, Bank, Realty, and IT were up 1–2% each. Of 2,145 stocks traded, 1,032 advanced, 746 declined, and the remaining traded flat. We continue to remain in a Downtrend and suggest a cautious approach until general market conditions improve.
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