nifty technical analysis: Ahead of Market: 10 things that will decide D-Street action on Friday

Indian equities, dragged by index heavyweight Reliance Industries, ended in the red, snapping its 3-day rally. The Sensex fell by 181 points to close at 65,252, while the Nifty closed 57 points lower, settling below the 19,400 mark. Sectorally, the IT index emerged as the top gainer, while the Healthcare and PSU Bank indices were the top laggards.

Here’s what analysts predict for the market:

“The US market displayed a positive trend as a declining US PMI reignited hopes for a prolonged rate pause, calming US bond yields. While optimism in the domestic market was apparent in the IT sector, sentiments in other major sectors likely waned due to global uncertainties. However, mid- and small-cap stocks showed resilience, and declining bond yields prompted a revival in foreign investor buying,” said Vinod Nair, Head of Research at Geojit Financial Services.

“The Nifty remained under the bear’s influence as selling pressure mounted around the day’s high, leading to a drop below 19,500. Resistance is anticipated between 19,450 and 19,500. A decisive breakout or closing above 19,500 might trigger a rally. Conversely, immediate support is at 19,300; dipping below this could incite market panic,” stated Rupak De, Senior Technical Analyst at LKP Securities.

Given these analyses, let’s delve into some key indicators for Friday’s action:

US market:
Wall Street’s main indexes rose on Thursday, following a stellar forecast from chip designer Nvidia though caution ahead of Federal Reserve Chair Jerome Powell’s speech later this week kept gains in check.

The chip designer late on Wednesday forecast quarterly revenue that far exceeded expectations, boosting investor confidence in an artificial intelligence (AI) boom, and said it would buy back $25 billion in stock.Shares of Nvidia were last up only 3%, slipping from a fresh record high of $502.66 earlier in the session, with some analysts pointing to profit-taking after a strong run of gains heading into the second-quarter results.

European shares
European shares hit one-week highs on Thursday, with chipmakers lifting the technology sector after industry bellwether Nvidia far exceeded expectations with its quarterly revenue forecast, and as easing bond yields also improved risk sentiment.

By 0707 GMT, the pan-European STOXX 600 was up 1%, opening higher for a fourth straight session.

Tech stocks jumped 1.8% with chipmakers leading gains after Nvidia, the world’s most valuable chipmaker, forecast higher-than-anticipated quarterly revenue and also announced a share buyback programme.

Tech View
A long bear candle formed on the daily chart, signifying a bearish engulfing-type candle pattern (though not a classical one). The Nifty may decline or even break below the 19,300-19,250 levels in the near term. Any upward bounce could face resistance around 19,550.

Stocks with a bullish bias
The MACD signaled bullish trade for counters like Coforge, Engineers India, Vedanta, Sun TV, and Gujarat Ambuja, among others. The MACD is renowned for indicating trend reversals. A MACD crossing above the signal line suggests potential upward movement.

Stocks indicating forthcoming weakness
The MACD indicated bearish tendencies for Zee Entertainment, Bank of India, Piramal Enterprises, Tourism Finance, and LIC. A bearish crossover on their MACD suggests the start of a downward trajectory.

Most active stocks (value terms)
Notable stocks on the NSE in terms of value were Coforge (Rs 10,708 crore), HDFC Bank (Rs 3,416 crore), ICICI Bank (Rs 2,761 crore), RIL (Rs 1,771 crore), and SBI (Rs 1,395 crore). Higher activity on a counter in value terms can help identify the counters with highest trading turnovers in the day.

Most active stocks (volume terms)
Suzlon Energy, GMR Infra, IRFC, and South Indian Bank were among the most traded stocks in the NSE session.

Stocks attracting buyers
Shares like Titagarh Wagons, Religare, GMR Infra, DB Realty, and Mahindra Holiday saw strong buying interest, hitting their fresh 52-week highs.

Stocks under selling pressure
TVS Supply Chain, Jio Financial Services, Penta Gold, and Hotel Rugby were among stocks hitting their 52-week lows, signaling bearish sentiment on the counters.

Sentiment meter
The market sentiment leaned towards bears as 1,731 stocks concluded in the green, while 1,890 finished in the red.

(Disclaimer: Recommendations, suggestions, views, and opinions provided by experts are their own. They do not represent the views of Economic Times.)



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