Market Slips in the Last Hour; Financial Related Stocks Outperform

Nifty, -0.5%; Sensex, -0.55%; Nifty Midcap, -0.4%; Nifty Smallcap, +0.6%; Model Portfolio, +1.9%.

Market Pulse: Uptrend Under Pressure

Distribution Day Count: Six

Nifty continued its yesterday’s positive momentum and made a high of 17,600. However, in the last hour, Nifty was under selling pressure and lost more than 200 points from its intraday high. Some heavy weight stocks of the index like Infosys, Maruti, Reliance, and ITC fell 1.5–2.5%, which pushed Nifty lower. On the flip side, bank and other financial related stocks supported Nifty. The index escaped a distribution day as volume was little less than the yesterday’s session. Action in the broader market was constructive in the first half but came under selling pressure in the second half. However, Nifty Smallcap closed 0.6% higher. Out of 2,044 traded stocks, 1,080 stocks advanced, 905 declined, and the rest remained unchanged.

Source: Google Image

On Monday, market status was changed to an Uptrend Under Pressure. We will change the status to a Downtrend if more distribution days are added or if Nifty fails to reclaim its 50-DMA and market leaders show signs of deterioration in their price actions. On the flip side, the status will be changed back to a Confirmed Uptrend if Nifty retakes the 18,604 level (the high during the recent rally). Proceed with caution. Stocks slipping below their 50- and 200-DMA on above average volume should be sold. Consider exiting stocks that have declined 8% from the buy price.