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Nifty Retakes 50-DMA; Metal Stocks Continue to Shine

May 07 2021
Weekly Action
Nifty, +1.3%; Sensex, +0.9%; Nifty Midcap, +1.5%; Nifty Smallcap, +2.0%; Model Portfolio, +3.3%.
Market Pulse: Confirmed Uptrend
Distribution Day Count: Two
Weekly Market Review
Nifty breached its 50-DMA last week and traded below it for the first four trading sessions of this week. However, it found support at its 100-DMA in the first three trading sessions and closed above it. Historically, 100-DMA has been a good support for Nifty. Today, the index gapped up almost 100 points and traded in a narrow range throughout the session. Thus, it reclaimed its 50-DMA. Trading volume remained below average this week.
On the sectoral front, Nifty Metal (+10.7%) was the top gainer for the week, followed by Nifty PSU Bank (+2.9%). On the flip side, Nifty Realty and Pvt Bank closed 0.6% and 0.2% lower, respectively. Today, the advance-decline ratio was in favor of advancers. Of the 2,251 stocks traded, 1,058 advanced, 826 declined, and the rest remained unchanged.
Looking ahead, without trying to predict and decode stories, we will take what the market gives and continue to monitor unfolding conditions. Stocks that are breaking out of consolidation with higher relative strength and superior fundamentals can do well. Continue to trim or avoid ideas lagging and/or breaking down below major moving averages.
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