The market was caught in a bear trap on December 17 as well as for the entire last week amid relentless FII selling, hawkish stance by the Federal Reserve and a surprise rate hike by the Bank of England.
All sectors, barring IT, closed in the negative terrain with bank, auto, financial services, FMCG and metal indices losing 2-2.5 percent. However, Accenture's results and FY22 outlook lifted IT stocks.
The BSE Sensex plunged nearly 900 points or 1.5 percent to 57,012, while the Nifty50 closed below 17,000 mark, down a little more than 260 points on Friday. The broader markets - the Nifty Midcap 100 and Smallcap 100 indices - corrected more than 2.4 percent each.
Stocks that were in focus include Wipro and Persistent Systems which were the biggest gainers in the futures and options segment, rising 4.11 percent to Rs 670.80 and 3.03 percent to Rs 4,640.15.
Indiabulls Housing Finance, Apollo Hospitals Enterprises and Zee Entertainment Enterprises were among the top five losers in the F&O segment. Indiabulls Housing fell 8.21 percent to Rs 233.15, and Apollo Hospitals plunged 8.02 percent to Rs 4,786.70, while Zee Entertainment declined 7.02 percent to Rs 342.35.
Here's what Rajesh Palviya of Axis Securities, recommends investors should do with these stocks when the market resumes trading today:
The stock is in a strong uptrend across all the time frames forming a series of higher tops and higher bottoms indicating bullish sentiments. With the current close, the stock has decisively broken out its three-month resistance zone of Rs 4,460 levels, indicating strength ahead.
This breakout is accompanied by huge volumes indicating increased participation. The stock is well placed above 20, 50, and 100-day SMA (simple moving averages) which reconfirms the bullish trend.
The daily and weekly strength RSI (relative strength index) continues to remain bullish. On the daily chart, the Band Bollinger signals increased momentum in the near term.
The short-term support zone is placed at Rs 4,400-4,200 levels with the expected upside of Rs 4,800-4,900 levels.
With the current close, the stock has surpassed its six-week 'multiple resistance zone' of Rs 666 levels on a closing basis. This breakout is accompanied by huge volumes indicating increased participation.
This buying was observed from 20, 50, and 100 day SMA which reconfirm upside momentum. The daily and weekly strength RSI continues to remain in the bullish terrain. On the daily chart, the Band Bollinger signals increased momentum in the near term.
The short-term support zone is placed at Rs 650-630 levels with the expected upside of Rs 694-720 levels.
On the short-term chart, the stock is in a downtrend forming a lower high low formation. Currently the stock is trending below 20-day and 50-day SMA which supports bearish sentiments ahead.
The weekly RSI negative divergence signifies losing strength on medium-term charts. The short-term bias remains weak with an upside resistance zone of Rs 5,200-5,300 levels.
On the downside, any violation of the "bullish gap" area (Rs 4,800-4,688) on a closing basis may cause further weakness towards Rs 4,550-4,300 levels.
On the weekly chart, the past couple of weeks' price action has formed an "engulfing bearish" - a short-term trend reversal pattern. However, any follow-up down close below Rs 338 levels will confirm the above-mentioned pattern.
The stock is sustaining below its 20-day SMA which signals weakness in the near term. The daily and weekly strength indicator RSI has turned bearish along with negative crossover which signals weakness on short-term charts.
On the upside, the stock is facing a resistance zone towards Rs 366-379 levels. On the downside, the stock may revisit a lower support zone of Rs 320-290 levels.
Since June 2021, the stock has been consolidating within a broad range of Rs 290-200 levels representing a sideways trend. With recent week's high, the stock has reacted strongly from its multiple supply zone of Rs 290 levels along with huge volumes indicating profit booking at major resistance zones.
With the current close, the stock has violated its 20, 50, and 100-day SMA on a closing basis indicating weakness. The overall bias remains neutral to negative with a downside support zone of Rs 200-190 levels.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their 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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