Yesterday, Nifty opened lower but rebounded quickly and gained almost 100 points from low. It gained more strength as the day wore on and made a high of 11,950. However, due to some selling pressure, Nifty closed below 11,900. Nifty is trading 3.7% and 11% above is 50- and 200-DMA, respectively.

On the sectoral front, Nifty IT closed 1.4% higher. On the flip side, Nifty PSU bank ended 1.2% lower. There was muted action in the rest of sectoral indices. Nifty Bank, Auto, Financial Services, and Pharma closed 0.2–0.3% higher, while Nifty FMCG (-0.4%) and Metal (-0.2%) closed lower.

Looking forward, we would prefer to see a follow-through day before shifting the market to a Confirmed Uptrend. (A follow-through day is a solid up session, generally a 1.5% or higher gain, with volume being higher than the previous day). Should this occur, the focus will be on ideas that show the best relative strength with good accumulation. Stocks that recover the quickest tend to lead the next run. On the flip side, if Nifty breaches its recent low of 10,790, the market will be moved back to a Downtrend.

Key News

Colgate-Palmolive India, Bajaj Finance, and Ultratech Cement will report their Q2 FY21 results today.

Hindustan Zinc reported Q2 FY21 results. Profit fell 6.8% y/y to Rs 1,940 crore, while revenue increased to Rs 5,560 crore from Rs 4,511 crore on a y/y basis. Margin improved 340bps to 51.3%.

Indian Energy Exchange reported Q2 FY21 results. Profit fell 3.7% y/y to Rs 47 crore, while revenue increased to Rs 71 crore from Rs 67.5 crore on a y/y basis.PBT increased to Rs 61.5 crore from Rs 60.7 crore on a y/y basis.

O’Neil Market Condition Report

For the 24 emerging markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 15%; Rally Attempt, 10%; Uptrend Under Pressure, 50%; Downtrend, 25%.

For the 24 developed markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 20%; Rally Attempt, 5%; Uptrend Under Pressure, 65%; Downtrend, 10%.

Visit Marketsmith India to Read More About Indian Share Market News, Daily Market Tips, Model Portfolio etc.

Stock Market Tips
follow-through day
Confirmed Uptrend
Rally Attempt
Uptrend Under Pressure
Marketsmith India

Author's Bio: 

Marketsmith India, One stop solution for all your Stock Market needs. Get stock market ideas and stock predictions all at one place. A proprietary tool by William O'Neil India following CANSLIM method of investing.