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After The Bell: Market @over 4-month high! Here’s what investors should do on Friday 

The bulls took control of D-Street and pushed benchmark indices over a 4-month high. The S&P BSE Sensex reclaimed 38,000 while the Nifty50 closed above 11,200.

July 23, 2020 / 05:52 PM IST

The bulls took control of D-Street on July 23 to push the benchmark indices over a four-month high. The S&P BSE Sensex reclaimed 38,000 while the Nifty50 also closed above 11,200.

Analysts, however, are still not convinced of the price action. Hence, traders are advised to either taper down their long positions or book partial profits and buy again at lower levels.

The Nifty50, which opened at 11,135, rose to an intraday high of 11,239 but failed to hold the momentum. It retested 11,103 before closing at 11,215. The crucial resistance which the index has to climb is 11,238.

The Nifty reversed from the same level the previous day. The index hit an intraday high of 11,238.10 on July 22, and on Thursday it reversed after hitting 11,238.60.

Close

“Markets once again showed optimism as investors remained bullish on Reliance Industries counter while buying was also evident in financial stocks. Our markets witnessed volatile bouts in the first half but in the second half of the trading session, short-covering took place and the Nifty closed higher at 11,235,” Shrikant Chouhan, Executive Vice President, Equity Technical Research, at Kotak Securities told Moneycontrol.

“On Friday, traders need to be cautious between 11,300/11,350 levels and for the Bank Nifty at 23,400/23,500. Take partial profit on long positions or reduce weak long positions,” he said.

Also read: Taking Stock: Over 4-month high! Sensex reclaims 38,000; Nifty back above 11,200

IndexPricesChangeChange%
Sensex57,064.87-195.71 -0.34%
Nifty 5016,983.20-70.75 -0.41%
Nifty Bank35,695.30-281.15 -0.78%
Nifty 50 16,983.20 -70.75 (-0.41%)
Tue, Nov 30, 2021
Biggest GainerPricesChangeChange%
Power Grid Corp206.756.50 +3.25%
Biggest LoserPricesChangeChange%
Tata Steel1,071.20-43.55 -3.91%
Best SectorPricesChangeChange%
Nifty IT35043.75173.00 +0.50%
Worst SectorPricesChangeChange%
Nifty Metal5201.70-103.00 -1.94%

We have collated views of experts on what investors should do on July 24 when the market resumes trading:

Sumeet Bagadia, Executive Director at Choice Broking

With benchmark indices closing in positive territory, charts indicate that it will move up further. Both benchmark indices are trading above 21-day Moving Average (DMA) and have sustained above its recent top, giving strong indications of further upside movement.

Largecap counters are also showing northward direction on charts in the coming session. Going forward, support is seen at 11,100 while resistance is at 11,450.

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

Albeit Nifty50 registered a bullish candle without a follow-through sell-off to Wednesday’s Hanging Man formation, chart structure is not looking convincing enough to favour a long-side trade.

A decisive breakout in the form of a strong close above 11,238 is required to instill confidence among the bulls for the next leg of the move. In that scenario, targets can be in the 11400-500 levels.

However, a struggle around the upper boundary of the 21-day ascending channel, with deeply overbought levels on the daily and certain weekly momentum oscillators are strengthening the bearish sentiment too.

Moreover, our twin momentum oscillators generated a sell signal. Hence, we expect the Nifty to remain sideways with negative bias for the next couple of trading sessions.

Therefore, traders are advised to remain neutral but intraday traders can consider going long if the Nifty sustains above 11,250 for at least 30 minutes and look for a modest target at 11,350–390 levels.

Ajit Mishra, VP - Research, Religare Broking Ltd

Markets are riding high on better-than-expected earnings and upbeat global markets. Considering the momentum, the Nifty index might test 11,350 soon.

Traders should align their trades accordingly, but we suggest preferring hedged trades instead of outrights.

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

The Nifty managed to close above its crucial hurdle of 11,200 and supports are gradually shifting higher, which indicates a bullish stance on the market.

As long as the Nifty holds above 11,100, it can extend its momentum towards 11,333 then 11,500. On the downside, supports are seen at 11,050 and 11,000 levels.

India VIX fell by 0.96 percent at 24.64 levels. Overall, lower volatility is supporting the bullish scenario and every intraday decline is being bought.

On the options front, maximum Put OI is placed at 10,000 followed by 11,000 strikes, while maximum Call OI is at 11,500 followed by 11,000 strikes.

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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