NEW DELHI: As Nifty ended lower for the third straight session on Monday, it formed a bearish candle on the daily chart.

Vinod Nair of Geojit Financial Services said with high valuations and worries that earnings may not justify such valuations anytime soon, markets may trade with uncertainty for the time being.

Manish Hathiramani, proprietary index trader and technical analyst said the index could drop to 10950-11000 levels as the fall today has been fierce and on the back of good volumes.

“The resistance on the upside is at 11550-11600. Until then the markets look weak,” he said.

Ruchit Jain of Angel Broking said a continuation of the downmove could lead to further sell-off and hence traders should stay light on positions and avoid overnight positions.

“As far as levels are concerned, 11,185 and 11,110 are the intraday supports; followed by the short term support at the ‘89 DEMA’ which is around 11,940. On the flipside, 11,335 and 11,450 are now the immediate resistances,” he said.

That said here’s a look at what some of the key indicators are suggesting for Tuesday’s action:

US stocks hits near 7-week low on virus fears, stimulus fog
Wall Street’s main indexes hit their lowest in nearly seven weeks on Monday as concerns about fresh coronavirus-driven lockdowns and the inability of Congress to agree on more fiscal stimulus raised fears about another hit to the domestic economy. The Dow Jones Industrial Average was down 588.64 points, or 2.13%, at 27,068.78, the S&P 500 was down 59.80 points, or 1.80%, at 3,259.67, and the Nasdaq Composite was down 142.45 points, or 1.32%, at 10,650.83.

European shares on course for worst day since June
A slide in HSBC and Standard Chartered set the FTSE 100 on course for its worst day in three months on Monday after reports the banks were among those that moved allegedly illicit funds over the past two decades, while travel stocks plummeted on fears of more coronavirus-related lockdowns. An index of travel and leisure stocks, already among the biggest decliners this year, tumbled 5.6%. The mid-cap FTSE 250 fell 3.1% to its lowest in nearly two months.

Tech View: Nifty needs to revisit 11,333 for any recovery
“Nifty formed a Bearish candle on a daily scale and is heading towards its 50-DEMA, which does not bode well for the bulls. As long as it sustains below 11,333 level, more weakness can be seen towards 11,111 and 11,000 levels. Upside hurdles are shifting lower towards 11,450 zone,” said Chandan Taparia of Motilal Oswal Securities.

Check out the candlestick formations in the latest trading sessions

ETMarkets.com



F&O: Spike in VIX bad news for bulls
Nifty opened flattish on Monday, but failed to hold the 11,500 level and fell sharply in the second half of the session towards the 11,200 zone. The index has been forming lower top and bottom on the hourly scale and witnessed negative crossover on the mechanical indicator on daily and weekly scales. It formed a bearish candle on the daily scale, and headed towards its 50 DEMA, which doesn’t bode well for the bulls. India VIX moved up sharply by 10.66 per cent from 20.04 to 22.18 level. A sudden spurt in volatility indicated more weakness with a capped upside.

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) on Monday showed bullish trade setup on the counters of IIFL Securities, Hercules Hoists, Kanoria Chemical, Sasken Technologies, SKIL Infrastructure, Seamec, Bajaj Holdings, Solar Industries, Maharashtra Scooters and Damodar Industries among others.

Stocks signalling weakness ahead
The MACD showed bearish signs on the counters of Glenmark Pharma, Granules India, Equitas Holdings, TVS Motor, DCB Bank, InterGlobe Aviation, Trent, Cummins India, Sequent Scientific, PNB Housing Finance, NIIT, Berger Paints, Orient Electric, Jindal Saw, Max Financial Services, Balrampur Chini, Amara Raja Batteries, City Union Bank, Nippon Life AMC, Jubilant Foodworks, S H Kelkar & Company, Godrej Properties, Rico Auto Industries, Newgen Software Tech, KEC International, Avanti Feeds, Prestige Estates, EID Parry, Aditya Birla Money, Sadbhav Engineering, NCL Industries, Fineotex Chemical, Westlife Development, DB Corp, Minda Industries, VRL Logistics, PNC Infratech, Gabriel India, Greenply Industries, SRF, Nesco, Fine Organic Industries, Olectra Greentech, JMC Projects, Huhtamaki, Polycab India, KNR Constructions, CreditAccess Grameen, Atul and Sanofi India among others.

Monday’s most active stocks
Dr. Reddy’s Labs (Rs 6737.24 crore), RIL (Rs 3555.35 crore), HCL Tech (Rs 2069.18 crore), Infosys (Rs 1441.20 crore), Bajaj Finance (Rs 1227.56 crore), TCS (Rs 1142.62 crore), SBI (Rs 1086.79 crore), Bharti Airtel (Rs 1082.68 crore), HDFC Bank (Rs 1050.26 crore) and ICICI Bank (Rs 1035.56 crore) were among the most active stocks on Dalal Street on Monday in value terms.

Monday’s most active stocks in volume terms
Vodafone Idea (shares traded: 31.55 crore), YES Bank (shares traded: 9.24 crore), Tata Motors (shares traded: 6.47 crore), Ashok Leyland (shares traded: 5.82 crore), SBI (shares traded: 5.76 crore), Indiabulls Housing Finance (shares traded: 5.60 crore), BHEL (shares traded: 3.92 crore), IDFC First Bank (shares traded: 3.45 crore), Federal Bank (shares traded: 3.35 crore) and Uttam Value Steel (shares traded: 3.09 crore) were among the most traded stocks in the session.

Stocks seeing buying interest
Supreme Industries, Infosys, Natco Pharma, Apollo Hospital and Mindtree witnessed strong buying interest from market participants as they scaled their fresh 52-week highs on Monday signalling bullish sentiment.

Stocks seeing selling pressure
Kuantum Papers, Libas Designs and Tirupati Forge witnessed strong selling pressure in Monday’s session and hit their 52-week lows, signalling bearish sentiment on these counters.

Sentiment meter favours bears
Overall, market breadth remained in favour of bears. As many as 17 stocks on the BSE 500 index settled the day in green, while 483 settled the day in red.

Podcast: What spooked market sentiment suddenly? >>>
Investors on Dalal Street became poorer by over Rs 4 lakh crore on Monday due to heavy selling in index heavyweights amid a massive global selloff. RIL, ICICI Bank, Bharti Airtel and HUL led the fall, while Infosys, TCS and Kotak Mahindra Bank rose to pare some of the losses. Overall, Sensex tanked 811 points to settle at 38,034 while Nifty closed 282 points down at 11,222. We caught up with Astha Jain of Hem Securities to understand the investment opportunities available in the primary market.





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