MarketsmithIndia Articles

Nifty Manages to Close Higher; Broader Market Falls Sharply

Author: Rushit Sejpal

Posted Date: August 10 2021 | Reading Time: 2 minutes
Today’s Action

Nifty, +0.1%; Sensex, +0.3%; Nifty Midcap, -1.1%; Nifty Smallcap, -2.3%; Model Portfolio, -2.2%

Market Pulse: Confirmed Uptrend

Distribution Day CountThree

Nifty started the session on a positive note and extended gain in the first half. It made a new all-time high of 16,360. However, it failed to hold gains and staged a reversal. It lost over 150 points to make an intraday low of 16,203. In the last hour, Nifty reversed around 80 points and closed almost in the green. The broader market continued to underperform the index. Today’s selloff in midcap and smallcap stocks was sharp and deep.

Nifty Midcap and Smallcap index managed to find support near the 50-DMA and closed off lows. On the sectoral front, Nifty IT (+0.8%) was the top gainer, while Nifty Metal (-2.5%) was top loser. The advance-decline ratio favored the decliners. Of 1,995 stocks traded, 359 stocks advanced, 1,601 stocks declined, and the remaining closed flat.

Currently, the distribution day count stands at three. Nifty is trading near its all-time high. But the broader market action remains weak. 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. Reducing exposure to stocks breaking below their 21- or 50-DMA on higher volume is important. As there is weakness in the broader market, we recommend being selective while investing in new stock.

Key News

What do you think? Please email us any questions or comments.

Disclaimer: Information contained herein is not and should not be construed as an offer, solicitation, or recommendation to buy or sell securities. It is for educational purposes only.For more information, see our Legal disclosures here.

Related Article