Market Pulse: Confirmed Uptrend
Nifty50: Three Nifty Midcap100: Three Nifty Smallcap100: Three
Global stock markets: Dow 30, -0.03%; Nasdaq, -0.5%; S&P 500, -0.2%; Nikkei, +1.6%; Kospi, -0.1%; Hang Seng, +2.0%.
Nifty had started the last week on a positive note. It traded lower on Wednesday following global cues but rebounded on Thursday and continued its momentum on Friday as well. It did not add a distribution day last week. Nifty is trading 1.5% and 5.0% above its 21- and 50-DMA, respectively. The broader market outperformed the benchmark indices during the week. Last week, crude oil price rose to almost $83 per barrel and the INR depreciated to 75 per USD.
On the sectoral front, on a weekly basis, Nifty Auto, IT, and Energy closed 4.0–4.5% higher. Nifty Realty gained 3%, while Nifty Bank, Metal, and Financial Services advanced 0.5–1.5%. On the flip side, Nifty FMCG (-1.0%) and Pharma (-0.5%) closed lower.
The distribution day count currently stands at three. Further, Nifty is trading above all its key moving averages. We would like the index to continue trading above its key moving averages. After such a sudden rally, one must also be prepared for some mild pullback and 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.