Market puts traders to sleep; Sensex, Nifty close with microscopic gains
Market puts traders to sleep
The markets have been doing absolutely nothing for the past many sessions. The benchmark indices seem to be in a drowsy state since the big rally in September and the hang over after last months party does not seem to be over yet!
National Stock Exchange’s Nifty closed at 5,665.60, up 1.30 points or 0.02% from previous close and Bombay Stock Exchange’s Sensex ended the session at 18,635.82, up 10.48 points or 0.06%.
Tracking Trade:
The market opened flat and tried to move up. It succeeded in recording the highs for the day within the first hour of trade. Nifty made a high of 5,698.30 and Sensex touched the level of 18,743.41. The benchmark indices then meandered in a narrow range and slipped lower.
The European markets opened in the red and Indian equities got an opportunity to make their intraday lows. Nifty made a low of 5,645.10 and Sensex touched the level of 18,572.02. The key indices then tried to move up and ended the session where they had started. Nifty November Future closed with a fat premium of 40 points.
Nifty continued to trade in the 100 point range of 5,630 and 5,730. It is more than three weeks that the index has been stuck in this range. A big move on the index can be expected only if it moves out of this range. Today was the second consecutive session when the index closed below its 20 DMA which is around 5,700 levels. The index has jumped above and below this level several times in the past one month. As such, interpreting this move may not be very fruitful.
Nifty has made a “Doji” on the daily candlestick chart which is not a favourable pattern for the bulls after a long consolidation combined with a close below 20 DMA. This is just before the RBI policy which will be unveiled tomorrow. The combination of all these technical factors needs serious attention from short term traders. The situation looks even more precarious as the most sensitive index to tomorrow’s event; Bank Nifty ended the session just above its 20 DMA. The nine-period Bollinger band on Nifty has also contracted which suggests a big move in the 50-stock index, sooner than later. It is almost impossible to anticipate the direction of the move but the probability of an upside breakout seems to have been reduced though it still exists.
Even if Nifty breaks on the downside, it has multiple supports. Its 50 DMA is around 5,530 and the 61.8% Fibonacci retracement level of the move from 5,215.70 to 5,815.35 is around 5,440. This area may act as a strong support if the index does move on the downside. However, no trade would be initiated by traders unless the index breaks above or below the 100 point range of 5,630 to 5,730.
Bank Nifty closed at 11,472.15, down 37 points or 0.32% from previous close. This was the weakest of the three important indices traded on the NSE. Like the Nifty, Bank Nifty too displayed a range bound movement. The index has strong support around 11,300 levels. Tomorrow’s RBI policy may help this index to choose a clear direction in the short term.
If the RBI does not oblige with a rate cut tomorrow, Bank Nifty may take a southward route. However, the index has supports at lower levels. Its 50 DMA is around 10,740 levels and 38.2% Fibonacci retracement level of the move from 9,814.05 to 11,745.20 is around 11,000 levels. This area may act as support if the index does move on the downside.
CNX IT closed at 6,032.45, up 7.05 points or 0.12% from previous close. This was relatively the strongest amongst the three important indices traded on the NSE. The index has been consolidating since the last ten sessions after the big move on October 12. It has closed for the second consecutive session below its 100 DMA which is around 6,050 levels. The index has consistently traded below its 200 DMA which is around 6,130.
CNX IT is listless. It is neither weak nor strong. However, it is important for this index to hold above 5,900 as it is the 61.8% Fibonacci retracement level of the move from 5,460.70 to 6,643.80. It would be logical to assume that the up move in this index which began on July 26 is over if the index breaks and closes below 5,900.
India VIX closed at 15.12, up 6.40% from previous close. This index seems to be in some kind of an uptrend. It has made higher highs and higher lows since the past four trading sessions. Today it has made a “Bullish Belt hold” on the daily candlestick charts which is a bullish pattern. The pattern will be confirmed only if the index trades above today’s high. The index has closed below its 20 DMA which is around 15.50.
An interesting point is that the VIX went up by more than 6% when the Nifty moved up by only 0.02%. The increase in volatility may be attributed to the uncertainty in the minds of market participants because of tomorrow’s RBI policy meet.
The broader market closed on a negative note. The BSE Midcap Index closed with a loss of 0.43% and BSE Smallcap Index ended the session with a loss of 0.60%.
Out of the 13 sectoral indices traded on the BSE, six closed in the green. The biggest gainers were BSE Oil & Gas Index (0.62%), BSE Consumer Durables Index (0.51%), BSE Healthcare Index (0.27%), BSE Teck Index (0.13%) and BSE IT Index (0.13%). The losers included BSE Capital Goods Index (-1.69%), BSE Realty Index (-0.72%), BSE Power Index (-0.68%), BSE PSU Index (-0.56%) and BSE Bankex (-0.28%).
The top five Sensex gainers were Wipro (2.56%), Hero MotoCorp (1.95%), Tata Power (1.82%), Dr.Reddy’s (1.62%) and Reliance Industries (1.53%). Top five Sensex losers included BHEL (-6.19%), Sterlite Industries (-2.28%), Tata Motors (-1.80%), Coal India (-1.11%) and L&T (-1.08%).
Market breadth closed on a negative note. Out of 2,965 stocks traded on BSE, 1,234 advanced, 1,604 declined and 127 remained unchanged.
Tracking Trade:
The market opened flat and tried to move up. It succeeded in recording the highs for the day within the first hour of trade. Nifty made a high of 5,698.30 and Sensex touched the level of 18,743.41. The benchmark indices then meandered in a narrow range and slipped lower.
The European markets opened in the red and Indian equities got an opportunity to make their intraday lows. Nifty made a low of 5,645.10 and Sensex touched the level of 18,572.02. The key indices then tried to move up and ended the session where they had started. Nifty November Future closed with a fat premium of 40 points.
Nifty continued to trade in the 100 point range of 5,630 and 5,730. It is more than three weeks that the index has been stuck in this range. A big move on the index can be expected only if it moves out of this range. Today was the second consecutive session when the index closed below its 20 DMA which is around 5,700 levels. The index has jumped above and below this level several times in the past one month. As such, interpreting this move may not be very fruitful.
Nifty has made a “Doji” on the daily candlestick chart which is not a favourable pattern for the bulls after a long consolidation combined with a close below 20 DMA. This is just before the RBI policy which will be unveiled tomorrow. The combination of all these technical factors needs serious attention from short term traders. The situation looks even more precarious as the most sensitive index to tomorrow’s event; Bank Nifty ended the session just above its 20 DMA. The nine-period Bollinger band on Nifty has also contracted which suggests a big move in the 50-stock index, sooner than later. It is almost impossible to anticipate the direction of the move but the probability of an upside breakout seems to have been reduced though it still exists.
Even if Nifty breaks on the downside, it has multiple supports. Its 50 DMA is around 5,530 and the 61.8% Fibonacci retracement level of the move from 5,215.70 to 5,815.35 is around 5,440. This area may act as a strong support if the index does move on the downside. However, no trade would be initiated by traders unless the index breaks above or below the 100 point range of 5,630 to 5,730.
Bank Nifty closed at 11,472.15, down 37 points or 0.32% from previous close. This was the weakest of the three important indices traded on the NSE. Like the Nifty, Bank Nifty too displayed a range bound movement. The index has strong support around 11,300 levels. Tomorrow’s RBI policy may help this index to choose a clear direction in the short term.
If the RBI does not oblige with a rate cut tomorrow, Bank Nifty may take a southward route. However, the index has supports at lower levels. Its 50 DMA is around 10,740 levels and 38.2% Fibonacci retracement level of the move from 9,814.05 to 11,745.20 is around 11,000 levels. This area may act as support if the index does move on the downside.
CNX IT closed at 6,032.45, up 7.05 points or 0.12% from previous close. This was relatively the strongest amongst the three important indices traded on the NSE. The index has been consolidating since the last ten sessions after the big move on October 12. It has closed for the second consecutive session below its 100 DMA which is around 6,050 levels. The index has consistently traded below its 200 DMA which is around 6,130.
CNX IT is listless. It is neither weak nor strong. However, it is important for this index to hold above 5,900 as it is the 61.8% Fibonacci retracement level of the move from 5,460.70 to 6,643.80. It would be logical to assume that the up move in this index which began on July 26 is over if the index breaks and closes below 5,900.
India VIX closed at 15.12, up 6.40% from previous close. This index seems to be in some kind of an uptrend. It has made higher highs and higher lows since the past four trading sessions. Today it has made a “Bullish Belt hold” on the daily candlestick charts which is a bullish pattern. The pattern will be confirmed only if the index trades above today’s high. The index has closed below its 20 DMA which is around 15.50.
An interesting point is that the VIX went up by more than 6% when the Nifty moved up by only 0.02%. The increase in volatility may be attributed to the uncertainty in the minds of market participants because of tomorrow’s RBI policy meet.
The broader market closed on a negative note. The BSE Midcap Index closed with a loss of 0.43% and BSE Smallcap Index ended the session with a loss of 0.60%.
Out of the 13 sectoral indices traded on the BSE, six closed in the green. The biggest gainers were BSE Oil & Gas Index (0.62%), BSE Consumer Durables Index (0.51%), BSE Healthcare Index (0.27%), BSE Teck Index (0.13%) and BSE IT Index (0.13%). The losers included BSE Capital Goods Index (-1.69%), BSE Realty Index (-0.72%), BSE Power Index (-0.68%), BSE PSU Index (-0.56%) and BSE Bankex (-0.28%).
The top five Sensex gainers were Wipro (2.56%), Hero MotoCorp (1.95%), Tata Power (1.82%), Dr.Reddy’s (1.62%) and Reliance Industries (1.53%). Top five Sensex losers included BHEL (-6.19%), Sterlite Industries (-2.28%), Tata Motors (-1.80%), Coal India (-1.11%) and L&T (-1.08%).
Market breadth closed on a negative note. Out of 2,965 stocks traded on BSE, 1,234 advanced, 1,604 declined and 127 remained unchanged.
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