Tag: Uptrend Under Pressure

Posted on

Nifty Retakes its 50-DMA; Financial Related and Metal Stocks Surge

Today’s Action

Nifty, +1.7%; Sensex, +1.7%; Nifty Midcap, +1.8%; Nifty Smallcap, +1.2%; Model Portfolio, +2.5%

Market Pulse:  Confirmed Uptrend

Distribution Day Count:   Three

Nifty opened around 100 points, higher tracking global cues. The index made a new intraday high, and reclaimed its 50-DMA. As volume was lower than yesterday’s, today’s action didn’t qualify as an additional follow-through day. Of the Nifty50 stocks, 78% advanced led by Indusind Bank(Nse) (+7.5%) and State Bank Of India (+6.7%).

Barring Nifty Media (-0.5%) and Pharma (-0.2%), all the sectoral indices closed in the green. Financial related indices led the rally followed by Metal stocks. The advance-decline ratio was in favor of advancers. Of the 2,299 stocks traded, 1,333 advanced, 627 declined, and the rest remained unchanged.

On a technical perspective, Nifty retook its 50-DMA, which is a good sign. Without trying to predict and decode stories, we will take what the market gives and continue to monitor unfolding conditions. If the index falls further, adds a distribution day, and breaches its key moving averages, we may change the market status to an Uptrend Under Pressure. Continue to trim or avoid ideas lagging and/or breaking down below major moving averages.

Key News

Colgate-Palmolive India announced its Q4 FY21 results. Revenue was up 19.8% y/y to Rs 1,283 crore. PAT increased 54.1% to Rs 314 crore.

Federal Bank’s Q4 FY21 NII was up 16.8% y/y to Rs 1,420 crore. PAT surged 58.6% to Rs 477 crore.

Wholesale inflation (WPI) for April increased to 10.49% due to a rise in fuel (petrol and diesel) prices.

Related article:

Is Asian Paints Stock still a good buy?

Watch out for Chemical-Agriculture Stock As It Races Towards Its 52-week High.

Posted on

SGX Nifty Indicates Positive Opening; Bharti Airtel and Federal Bank to Declare Q4 Results Today

At 8:00 am IST, SGX Nifty Futures was trading at 14,750, compared with Nifty’s close of 14,677, on Friday.

Market Pulse: Confirmed Uptrend

Distribution Day Count:  Three

Global stock markets: Dow30, +1.1%; S&P 500, +1.5%; Nasdaq, +2.3%; Kospi, -0.1%; Nikkei, -0.6%; Shanghai Composite, +0.9%

Nifty breached its 50-DMA last week. The next level of support is at its 100-DMA, just 100 points below the Friday’s closing price. Historically, 100-DMA has been a good support for Nifty. On Friday, it opened with a 50-point gain, but succumbed to profit booking and quickly turned negative. It was a volatile session as the day’s range was more than 150 points.

On the sectoral front, Nifty PSU Bank (+3.7%) was the top gainer for the week, followed by Nifty Media (+2.4%). On the flip side, Nifty Metal (-4.6%) which rallied the most in the past few weeks, succumbed to profit booking during the week. Friday, the advance-decline ratio was in favor of decliners. Of the 2,264 stocks traded, 777 advanced, 1,142 declined, and the rest remained unchanged.

One distribution day was added during the week, increasing the count to three. Nifty trading below its 50-DMA is a sign of caution. We expect Nifty to hold its 100-DMA. However, the breach of 100-DMA opens a further downside risk. Continue to trim or avoid ideas lagging and/or breaking down below major moving averages. We would downgrade the market status to an Uptrend Under Pressure if Nifty breaches its 100-DMA and/or distribution day count increases.

Key Results Today: Bharti Airtel, Federal Bank, Colgate Palmolive India, Orient Cement, Shakti Pumps India, and others.

Key News:

Quick Heal Technologies reported its Q4 FY21 results. Consolidated revenue jumped 63.9% y/y to Rs 105.3 crore. PAT surged 3.9x to Rs 39.7 crore.

Geojit Financial Services reported its Q4 FY21 results. Revenue increased 47.4% y/y to Rs 121.4 crore. PAT grew 88.6% to Rs 37.2 crore.

Larsen & Toubro’s Q4 FY21 PAT was above consensus. Revenue rose 8.7% y/y to Rs 48,087.9 crore. PAT increased 3% to Rs 3,293 crore.

Buy Watchlist: Ramkrishna Forgings, Hindustan Zinc (Nse), Pi Industries, Relaxo Footwears, Tata Power, Gujarat State Petronet, Apollo Hosps.Enterprise, Eris Lifesciences, Asian Paints, Mphasis (Nse),Chambal Fert. & Chems, Lux Industries, Rain Industries, Apollo Tricoat Tubes, and Balkrishna Industries

Related articles:

Nifty Breached its 50-DMA; What to Expect from the Market

Posted on

Nifty Breached its 50-DMA; What to Expect from the Market

Recently, the markets have been highly volatile. We have to be cautious as Nifty has breached its 50-DMA and distribution count has increased to three. The next level of support is at its 100-DMA (14,575), which is just 100 points below the Friday’s closing of 14,677. Historically, 100-DMA has been a good support for Nifty. If that level, is breached then further downside is expected.

What if the market continues to decline?

If the Nifty declines more than 0.2% on volume higher than the previous session, we would consider it as a distribution day. Accumulation of distribution days is tracked, if the count increases to four/five, we would downgrade the market status to an Uptrend Under Pressure.

The above picture explains our methodology in changing market direction. In a Confirmed Uptrend, our conviction toward the market is high and capital allocation would be maximum. In an Uptrend Under Pressure, we would start trimming our positions and book out most of our profits. Fresh initiations would be minimal, only highly rated stocks exhibiting strong price-volume action would be added to our model portfolio.

In a Downtrend, our conviction is the lowest. We would exit our model portfolio and stay in cash. Fresh positions will not be initiated in this status.

Related articles: How to identify market top distribution days give an idea?

How to invest in stock market using CANSLIM?

Secret to success in the stock market

CANSLIM Strategy

Posted on

Nifty Declines 1% During the week; Metal Stocks Succumbed to Profit Booking

Weekly Action

Nifty, -1.0%; Sensex, -1.0%; Nifty Midcap, -0.7%; Nifty Smallcap, +0.3%; Model Portfolio, +0%.

Market Pulse: Confirmed Uptrend

Distribution Day Count: Three

Weekly Market Review

After retaking its 50-DMA last week, Nifty breached that level this week. The next level of support at its 100-DMA is just 100 points below the closing price. Historically, 100-DMA has been a good support for Nifty. Today, it opened with a 50-point gain, but succumbed to profit booking and quickly turned negative. It was a volatile session as the day’s range was more than 150 points.

On the sectoral front, Nifty PSU Bank (+3.7%) was the top gainer for the week, followed by Nifty Media (+2.4%). On the flip side, Nifty Metal (-4.6%) which rallied the most in the past few weeks, succumbed to profit booking during the week. Today, the advance-decline ratio was in favor of decliners. Of the 2,264 stocks traded, 777 advanced, 1,142 declined, and the rest remained unchanged.

One distribution day was added during the week, increasing the count to three. Nifty trading below its 50-DMA is a cautious sign. We expect the Nifty to hold its 100-DMA. However, if it breaches its 100-DMA, it opens further downside. Continue to trim or avoid ideas lagging and/or breaking down below major moving averages. We would downgrade the market status to an Uptrend Under Pressure if Nifty breaches its 100-DMA and/or distribution day count increases.

Key News

Dr. Reddy’s Laboratories  Q4 FY21 revenue grew 6.7% y/y to Rs 4,728 crore. PAT was down 27.5% y/y to Rs 554 crore. It also announced a dividend of Rs 25 per share.

Jindal Stainless announced its Q4 FY21 results. Consolidated revenue from operations grew 26.5% y/y to Rs 3,913 crore. It reported a profit of Rs 292 crore against a loss of Rs 66 crore in Q4 FY20.

Escorts announced its Q4 FY21 results. Revenue from operations increased 60.8% y/y to Rs 2,229 crore. PAT surged 122% to Rs 285 crore. EBITDA margin improved 230bps to 15.4%

Related Articles:

These Two Stocks Are Trading At A Extended Zone: Alkyl Amines and Dcm Shriram

This Utility-Electric Power Stock Is Nearing A Pivot Point: Tata Power

Posted on

SGX Nifty Indicates Flat Opening; L&T and Dr Reddy to Declare Q4 Results Today

At 8:00 am IST, SGX Nifty Futures was trading at 14,670, compared with Nifty’s close of 14,696, Wednesday.

Market Pulse: Confirmed Uptrend

Distribution Day Count: Three

Global stock markets: Dow30, +1.3; S&P 500, +1.2%; Nasdaq, +0.7%; Kospi, +0.6%; Nikkei, +1.6%; Shanghai Composite, +0.6%

On Wednesday, Nifty opened flat and quickly succumbed to selling pressure and lost over 120 points within the first two hours of trading. The index pared most of its losses as some buying was seen at the lower levels. But as the selling pressure overtook the index again, Nifty closed near the day’s low. The index escaped a distribution day as the volume was slightly lower than yesterday’s. There was a mixed action on the sectoral front. Nifty PSU Bank (+3.2%), Media (+0.7%), and Auto (+0.2%) closed higher. On the flipside, Nifty Metal (-2.9%) declined the most followed by financial-related stocks especially private banks.

On a technical perspective, Nifty breached its 50-DMA, which is not a good sign. Without trying to predict and decode stories, we will take what the market gives and continue to monitor unfolding conditions. If the index falls further, adds a distribution day, and breaches its key moving averages, we may change the market status to an Uptend Under Pressure. Continue to trim or avoid ideas lagging and/or breaking down below major moving averages.

Key Results Today: Larsen & Toubro, Dr. Reddy’s Laboratories, Balkrishna Industries, Cipla, Escorts, and others.

Key News:

Hindalco Industries’s subsidiary Novelis’ Q4 PAT grew 186% y/y to $180M. Net sales increased 33% y/y to $3.6B.

Pidilite Industries(Nse)’s Q4 FY21 PAT and revenue came above consensus, while margin missed estimates. PAT nearly doubled y/y to Rs 307 crore.

Birla Corporation (Nse)’s Q4 FY21 PAT and revenue came above consensus, while margin missed estimates. PAT grew 27.7% y/y to Rs 249 crore. Revenue grew 26% y/y to Rs 2,132 crore. Margin contracted 200bps to 18.4%.

Buy Watchlist: Ramkrishna Forgings, Hindustan Zinc (Nse), Pi Industries, Relaxo Footwears, Tata Power, Gujarat State Petronet, Apollo Hosps.Enterprise, Eris Lifesciences, Asian Paints, Wipro (Nse), Amrutanjan Health Care, Lux Industries, Rain Industries, Apollo Tricoat Tubes, and Balkrishna Industries

Related articles : 

Upl Stock Is Breaking Out Of A 5-Week Flat Base Pattern

This Utility-Electric Power Stock Is Nearing A Pivot Point: Tata Power