After The Bell: Bulls back in action, here’s what investors should do on Friday

For the next two days, 13,070 and 13,150 levels will be major hurdles for the Nifty. If it crosses 13,150, it can jump to 13,350 but below 12,930, the index will invite worries, say experts.

November 26, 2020 / 05:27 PM IST

The Indian market that started the day on a muted note recouped losses and closed with gains of 1 percent on the November F&O Expiry day. The S&P BSE Sensex rallied 431 points to close at 44,259 while the Nifty50 ended 128 points higher at 12,987.

Sectorally, action was seen in metal, finance, telecom, healthcare, and banks while profit booking was seen in oil & gas space.

The market was volatile amid November F&O expiry but the bulls managed to push the index back in the green in the second half. Banking stocks led the rally from the front ahead Q2 GDP data.

"Today, the market regained its momentum during the second trading half, on the monthly derivative expiry day, led by the bounce in the banking sector. Investors are awaiting the release of Q2 GDP data tomorrow, the market expects contraction on a YoY basis but an improvement on a QoQ basis, reflecting a recovery in economic activity," Vinod Nair, Head of Research at Geojit Financial Services told Moneycontrol.

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"The recovery is expected to further rise in Q3, and the market optimism is also high with the news that vaccine will be available in early 2021," he said.

Here is what experts think that investors should do on November 27:

Shrikant Chouhan, Executive Vice President, Equity Technical Research, Kotak Securities

Two major events, short-covering ahead of November 2020 F&O expiry and rebalancing of MSCI portfolios, helped the Indian market recover sharply from lower levels.

The Nifty 50 index regained 13,000 levels and is exhibiting remarkable strength. The unusual support from commodities and financials helped the market to move forward.

Technically, for the next two days, 13,070 and 13,150 levels would be major hurdles for the index. If the Nifty 50 crosses 13,150, it could jump to 13,350. However, below 12930, the index would invite worries in the near term.

Chandan Taparia, Vice President | Analyst-Derivatives at Motilal Oswal Financial Services Limited

The Nifty opened positive, saw a little dip in the initial hour of the session but recovered well. It formed a bullish candle on a daily scale along with a long lower shadow, which indicates that every small decline was being bought. Now it has to hold above 12,900 to witness a bounce towards 13,150 then 13,250, while on the downside support exists at 12,800 zones.

Mazhar Mohammad, Chief Strategist–Technical Research & Trading Advisory, Chartviewindia.in

In case the Nifty manages to get past 13,145 on a closing basis, then traders should play on the long side for a possible target of 13,500.

Considering the strong appetite of the bulls at lower levels, it is advisable to refrain from shorting but before going long it would be prudent to wait and watch one more trading session of price action.

Rahul Sharma, Market Strategist & Research Head, Equity99 Advisors

In an extremely volatile trading session, the benchmark indices settled higher with more than 60-65 percent roll-over of open positions in the December 2020 series. With relaxation in the SEBI norms for margin regulations, we expect action to start shifting to midcap stocks.

The underlying trend remains intact. On the upside, we expect the Nifty to face resistance at 13,010 and above that at 13,310-13,320. Overall, we continue to remain bullish, with minor intermediate corrections.

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

Kshitij Anand is the Editor Markets at Moneycontrol.

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