Replete Bell Indian Equity Market Update

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Replete Bell – Wednesday, 10th January 2018

Earnings Season Keeps Investors On Their Toes

 Today’s Action:

Market observes a volatile trading session.

Current Outlook:

  • Market environment conducive for new purchases, but remain selective.
  • Focus on fundamentally strong stocks breaking out of strong technical patterns.
  • Stay disciplined and exercise sound buy and sell rules.

Daily Market Review

Markets today kept investors on their toes as volatility was at its peak. This kind of a movement is normal during earnings season and therefore one should not be dismayed by this movement. The Nifty after having a great run today lost 0.05% while the Sensex lost 0.03%. It is a pertinent fact that markets cannot rise continuously as traders will book profits as they get opportunities to do so; some temporary jitters should not be a big deal in a bull market.

Midcap stocks (-0.14%) have been observing some distribution as investors resort to some profit booking after earning some hefty returns in the recent past. Nifty Smallcap indices traded flat today.


Today apart from Nifty IT (2.24%), Realty (+1.26%) and Metal (+0.07%) all the sectors ended in red. Nifty PSU Banks (-1.38%), Auto (-0.71%) and Media (-0.38%) dragged down the indices most.

Today, the government has allowed 100% FDI under automatic route for single brand retail trading and construction development. Hence, news stocks such as Monte Carlo Fasions and Indian Indian Terrain Fashions more than 5% intraday. Government has also allowed foreign airlines to invest up to 49% via government-approved routes in Air India.

Continuous rise in crude prices could lead to high inflation, which could be bad for most of the industries as they may not pass the inflation to the ultimate consumer. So while investing in equities as an asset class, investors should be proactive in booking profits.

Lumax Industries was in limelight toward the last hour of the trading session as it informed the exchange that its new unit in Sanand, Gujarat, has started the commercial production. This will help the Company increase its sales revenue, which will positively impact the share price in future.

From Pharma, Glenmark Pharmaceuticals made a presentation at the JP Morgan Healthcare Conference where it announced its intention to scale up its specialty business along with increasing complexity in generics. Pharma as a sector being the talk of the town, investors might look forward to this news positively and keep this stock in their radar.

The market breadth, which indicates the overall health of the market continues to be in favor of losers. Today on the NSE, 611 stocks advanced and 950 stocks declined. A total of 47 stocks remain unchanged.

Both the Sensex and the Nifty dropped one distribution day due to distribution day reversal (Click on this Link to read more about distribution day reversal) on Monday, which means the index closed at more than 5% from the distribution day level and yesterday Sensex dropped one distribution day due to ageing and hence the total count for the Sensex and the Nifty remains at one and three, respectively, while the Indian market condition remains at a Confirmed Uptrend.

Source- MarketSmith India

Technical Summary of Nifty By Replete Equities:-

Replete Bell

Nifty start this week with a good momentum open Gap Up on Monday a made a new all-time high but from last two sessions, it looses all its momentum and trading in a range only. still not giving a promising signal for a strong upside move but not looking week neither on Hourly chart nor on the daily chart. so we can expect some more range-bound trading in Nifty. We are holding our long from 10452.50 with a trailing stop loss of 10330.

According to open Interest data, highest open interest is at 10700 CE & 10500 PE. the same range we can expect for coming to few sessions. Budget session and earning session is going to start so we can expect a good volatility in the market from next few weeks. so always plan your trade accordingly.

Some Technical Parameters:-

NSE NIFTY is long-term Bullish as the 144 days moving average of 10,041.93 is increasing. The Relative Strength Index is at 67.01 in the neutral territory. The Relative Momentum Index is at 73.11 in the overbought territory. An important indicator for Elliott waves, the Elliott oscillator is at 174.45, in positive territory; this is a bullish sign. An equally important indicator, the STORSI is at 98.31. This value is in the overbought territory.

Weekly Pivot Point Resistance and Support

The first weekly resistance level is at 10,615.08 while the second resistance level at 10,671.32. The first weekly support level is at 10,453.63 while the second support level is at 10,348.42.

Additional information:-

Tomorrow’s projected High: 10,643.85, the projected Low:10,581.05. The top 21-day Bollinger band is at 10,710.82 while the bottom 21-day Bollinger band is at 10,234.86.

DISCLAIMER: – we are not a SEBI research analyst. Views posted in Replete Bell only for educational purposes. There is no liability whatsoever for any loss arising from the use of this product or its contents. This product is not a recommendation to buy or sell, but rather a guideline to interpreting specified analysis methods.  This information should only be used by investors and traders who are aware of the risk inherent in securities trading.

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Sachin Sival is the founder and CEO of Replete Equities, an options trading company that specializes in delta hedging. A self-taught trader, Sachin has a passion for volatility trading and stock trading. Sachin loves to hone his skills by reading up on new strategies and techniques as well as taking part in industry events. In addition to being a successful entrepreneur, Sachin also takes pleasure in photography - as a hobby.

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