Nifty Trades 25% Above 200-DMA; Broader Markets Outperform

Nifty, +0.3%; Sensex, +0.3%; Nifty Midcap, +0.6%; Nifty Smallcap, +0.8%; Model Portfolio, +0.2%

Market Pulse Confirmed Uptrend

Distribution Day Count: Three

Nifty, after a gap up opening, slipped toward the day’s low of 13,473 in the first half of the trading session. However, it posted a handsome recovery in the last hour and came off-lows to close 0.3% higher. Volume was lower than the previous session. Broader markets outperformed as Midcap and Smallcap indices gained 0.6% and 0.8%, respectively. Nifty is trading 9% and 25.3% above its 50- and 200-DMA.

On the sectoral front, Nifty Media advanced the most, followed by Nifty Metal and PSU bank, which gained 1.4% and 1.8% for the day. On the flip side, Nifty Realty and Auto declined in the range of 1–1.1%. Market breadth was skewed toward advancers. Of 2,233 stocks traded, 1,204 stocks advanced, 697 declined, and the remaining stocks remained unchanged.

With leadership broadening and indices above relevant intermediate term-moving averages, we will continue to look for leadership-quality growth names to form entry points. After a strong rally, pullback/consolidation (if any) is a constructive sign if Nifty holds its 21-DMA. It is advised to closely review the existing positions and book partial profits in stocks that are extended from their moving averages. On the flip side, tracking distribution days is crucial. Accumulation of distribution days can halt the uptrend.