Market Pulse: Confirmed Uptrend Distribution Day Count: Nifty50: One Nifty Midcap100: Four Nifty Smallcap100: Five
Global stock markets: Dow 30, +0.4%; Nasdaq, +0.1%; S&P 500, +0.3%; Nikkei, +0.6%; Kospi, +0.6%; Shanghai Composite, +0.1%.
Nifty, after a flat opening yesterday, made a unidirectional upward movement throughout the session and hit fresh high. The index closed near the day’s high holding solid gains. Volume was lower than in the previous session, which is a sign of concern. In the broader market, Nifty Midcap and Smallcap advanced 1% each, performing in line with the major indices.
On the sectoral front, barring Nifty Auto (-0.2%) and Nifty PSU Bank (-0.5%), all other sectors closed in the green. Nifty IT (+1.7%) emerged the top gainer for the day, followed by Nifty FMCG (+1.6%) and Nifty Realty (+1.3%). Similarly, Nifty Metal, Nifty Pharma, and Nifty Bank advanced in the range of 0.7–1.0%.
The distribution day count now stands at one as one day expired at yesterday’s close. Further, Nifty is now trading near its all-time high and is placed above all its key moving averages. We would like the index to continue this trend. After such a sudden rally, one must also be prepared for some mild profit booking. In the process, if the index adds a couple of distribution days, stages a reversal, or breaches its 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.
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