Nifty, -0.5%; Sensex, -0.5%; Nifty Midcap, -0.2%; Nifty Smallcap, -0.5%; Model Portfolio, -0.7%
Market Pulse: Confirmed Uptrend
Distribution Day Count: Three
Today, Nifty gapped higher by almost 100 points. However, it came under selling pressure in the first hour itself and turned negative. After moving sideways during the day, it fell more in the last hour, but closed above its 21-DMA. Today’s action will not be considered a distribution day as volume was very low. The broader market also failed to hold its opening gains and closed in the red. On the sectoral front, barring Nifty Auto (+0.4%), all sectors closed lower. Maruti led the gains in Auto stocks as it raised the price of most of its models. Nifty Metal and IT closed almost 1% lower, dragging the index down. The advance-decline ratio was in favor of decliners, as out of 2,260 stocks traded, 775 stocks advanced, 1,150 stocks declined, and the remaining closed flat.
We will continue to monitor the action for signs of health or crack in the market and leaders. The distribution day count currently stands at three. 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. Focus on quality ideas emerging out of sound bases with RS line at or near new highs while reducing exposure to stocks breaking below key support levels.