Nifty, +1.8%; Sensex, +2.1%; Nifty Midcap, -1.2%; Nifty Smallcap, -2.2%; Model Portfolio, -2.1%.
Market Pulse: Confirmed Uptrend
Distribution Day Count: Three
Weekly Market Review
After surpassing the 16,000 level convincingly last week, Nifty traded in the range of 16,150-16,350 for the first three trading sessions. Though the index witnessed significant intraday volatility, it managed to close flat in those sessions. However, in yesterday’s session, the index witnessed strong buying interest from investors after a flat start. It formed a higher-high, higher-low on the hourly chart and closed 0.5% higher. Today, it continued the momentum and extended the gain further to close at an all-time high. During the week, the broader market remained highly volatile. Both midcap and smallcap underperformed the index and declined 1.2% and 2.2%, respectively.
During the week, the sectoral indices had mixed results. Nifty IT (+4.4%) gained the most, followed by Nifty Energy (+1.4%) and Nifty Financial (+1.3%). On the flip side, Nifty Pharma (-3.2%) and Nifty Realty (-2.2%) were the major decliners. Today, the advance-decline ratio was in favor of decliners. Of the 1,986 stocks traded, 667 advanced, 821 declined, and the rest remained unchanged.
Currently, the distribution day count stands at three. Nifty is trading near its all-time high. We will continue to follow the action of leaders and look for constructive behavior and potential entry points to develop. If the index adds a couple of distribution days, stages a reversal, or breaches key moving averages, we may change the market status to an Uptrend Under Pressure. We continue to recommend a selective approach to increase risk. Focus on quality ideas emerging from sound bases with RS line at or near new highs while reducing exposure to stocks breaking below key support levels.