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Last Updated : Feb 18, 2019 07:15 AM IST | Source: Moneycontrol.com

A morning walk down Dalal Street | Nifty can move higher only if formation of lower highs is negated

If the index has to move higher, it has to negate the formation of lower highs by moving above 10,785 to witness a bounceback move towards 10,850 and then towards 10,929

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Indian market witnessed six straight sessions of decline for the first time since March 2018. The recent decline in the index pushed Nifty below crucial short and long-term moving averages. Nifty recouped losses after hitting its 100-day moving average placed at 10,694.

The last time when index slipped for 7-days on the trot was back in January. The Nifty index saw selling pressure from January 30 to February 7, 2018.

Close

For the last week, the S&P BSE Small-cap index and the S&P BSE Mid-cap index slid 2.96 percent and 2.71 percent respectively, compared to both S&P BSE Sensex and Nifty50, both of which fell about 2 percent in the same period.

Consistent selling was seen in the Indian markets that pushed the index towards crucial support levels. Most technical experts now feel that a technical bounceback could be on the cards.

The rupee slipped 7 paise closed at 71.23 against the dollar on February 15, pressured by heavy foreign capital outflows and firming oil prices.

On the institutional front, FPIs were net sellers in Indian markets for Rs 966 crore while DIIs were net buyers to the tune of Rs 853 crore, according to provisional data.

Big News:

The carnage in the broader market continued as both small and mid-cap indices underperformed benchmark indices for the week that ended on February 15.

Eleven shares outperformed the S&P BSE 500 index that fell 2.3 percent for the week. They include Dilip Buildcon, Shankara Building Products, Yes Bank, Redington India, Infibeam Avenues, Jindal Stainless, Reliance Capital, Dewan Housing Finance, Sun Pharma Advanced Research, Adani Power, and Dish TV.

As many as 20 stocks in the S&P BSE Small-cap index gave a 10-26 percent return that includes A2z Infra Engineering, Rolta India, Redington India, Jindal Stainless, Tree House, Kwality, JBF Industries, among others.

Technical Recommendations:

Nifty formed a bearish candle on the weekly chart and a hammer-like candle on the daily chart on February 14, which indicates that the immediate trend is in pressure, but some bounce could be seen at lower zones, suggest experts.

If the index has to move higher, it has to negate the formation of lower highs by moving above 10,785 to witness a bounceback move towards 10,850 and then towards 10,929.

On the downside, support exists at 10,620 then 10,580.

Three levels: 10620, 10785, 10850

Max Call OI: 11000, 10900

Max Put OI: 10700, 10400

Stocks in news:

The Reserve Bank has warned Yes Bank of regulatory action for disclosure of nil divergence report in violation of the confidentiality clause, the private sector lender said February 15.

Markets regulator Sebi on February 15 granted certain exemptions to Wipro from the buyback norms in case of the IT firm's proposed share repurchase programme, according to an order by the watchdog.

State-owned NBCC Ltd on February 15 said it has bid to take over bankruptcy-bound Jaypee Infratech and complete stalled housing projects in Noida, Uttar Pradesh.

Technical Recommendations:

We spoke to Way2Wealth Brokers Pvt. Ltd and here’s what they have to recommend:

Infosys: Buy around Rs 740–730| LTP: Rs 741| Target: Rs 800| Stop loss: Rs 700| Upside: 8 percent

BPCL: Sell around Rs 320–325| LTP: Rs 327| Target: Rs 270| Stop loss: Rs 345| Downside: 17 percent

Maruti Suzuki India: Sell around Rs 7,050–7,100| LTP: Rs 6,925| Target: Rs 6,500| Stop loss: Rs 7,330| Downside: 6 percent

Disclaimer: The views and investment tips expressed by investment expert on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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First Published on Feb 18, 2019 07:15 am
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