After a week of gains of more than 2%, the market continued to be “happy” in the new year, with purchases across the board fueled by power and real estate sectors, as well as mid-cap companies. As of Friday, the Sensex was at 61,223.03 points and the Nifty was at 18,255.8 points, respectively.
By comparison, the BSE power index rose by 7.4%, while capital goods rose by 6.0%, real estate rose by roughly 5%, and information technology rose by 3.0%. By comparison, the BSE mid and smallcap indexes rose by a modest 2-3 percent.
Over a hundred small-cap stocks grew between 10% and 47%. Participating companies included Ajmera Realty, Gujarat Mineral Development Corporation, Greaves Cotton, Kellton Tech Solutions, BCL Industries, Vikas LifeCare, Dollar Industries, Jagran Prakashan, MEP Infrastructure Developers, Varroc Engineering, Indo Rama Polyols, and Kanoria Chemicals & industries.
Between 8 and 25 percent were all losses for BGR Energy Systems, Hikal, Shriram EPC, Kilpest India, Mahanagar Telephone Nigam, and Vishwaraj Sugar Industries.
“The market’s winning streak came to an end on January 14. When it came to the smaller companies, we saw some buying quality counters. This week is expected to be a busy one for particular market sectors. The midcap and smallcap markets, on the other hand, are poised for gains in the days ahead,” experts have indicated. “Investors should keep building their equity portfolios in light of the positive market forecast. Investment in sector-specific securities and keeping track of earnings and losses are the best ways to make money as a trader.”
Seventeen to sixteen percent of the BSE midcap index’s gains came from the following companies: RBL Bank, Adani Power, Federal Bank, Indian Hotels Company, Hindustan Aeronautics, Container Corporation of India, Canara Bank, Mahindra & Mahindra Financial Services, Oberoi Realty, and Bharat Heavy Electricals.
“It’s been many days since the Nifty50 has been trading in a bullish trend technically without permitting any selling pressure. As of today’s closure, a new daily candle has wiped out the previous two candles and closed just at the high of the day,” according to analysts.
Additionally, the index has been lingering around the positive cross line of the Ichimoku Cloud formation. The RSI and Stochastic momentum indicators, expert claims, have also pointed to a positive crossover in the price chart.
“Support for the index is now at 18,100, while resistance is around 18350, with a break above the latter showing 18,500-18,600 as the next trading range. Bank Nifty’s support and resistance levels are both located just below 37.800 and just over 38.800 respectively,” it was observed by an analyst.
What does the Nifty 50’s future hold?
Short-term support will be found between 18,000-18,080, while new immediate resistance will be found at 18,340. Preparing for the predicted volatility, traders will be watching the upcoming budget session closely and may even take profits before the big event. The general structure of the index is still heavily in favor of the upward movement.
The market’s texture is upbeat, but an overstretched advance might cause it to settle between 18,050 and 18,375 points. This breakout pattern will extend up to 18,500 if bulls can get beyond 18,375-18,400.
This support level of 18,150 should be closely monitored. As long as the index closes below 18,050-18,000, the Nifty might return to those levels. At the 9-day SMA, the Bank Nifty ended one leg of its drop. According to the plan, strong support zones would be between 38,000 and 37,500. At this point, we may expect the upward trend to continue to the level of 39,000-39,000.
According to the chart structure, many believe that the upswing is not yet complete. There was positive stock-specific movement and solid purchase demand throughout the broader markets despite some sluggishness in the index approaching the week’s conclusion. A buy-on-dip strategy is recommended for the next week, so traders should retain a positive outlook.
The 18000 put option has attracted the greatest open interest from option writers as the index has increased in the last several months. With the short-term support base at roughly $18,000, any slide towards this level should be considered as a buying opportunity. The highest limit of this range is between 18,400 and 18,500 points.
Disclaimer: This blog is exclusively for educational purposes and does not provide any advice/tips on investment or recommend buying and selling any stock.
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