Here’s how analysts read the market pulse:
Mohammad said the index signed off the month with a Bullish Engulfing formation on the monthly charts, hinting at improving sentiment.
“If the index sustains above 17,018, it can extend the upswing towards 17,550 where a slew of resistance points are placed. However, the swift up move from the lows of 16,438 to a high of 17,170 in just three trading sessions can lead to some consolidation or profit booking,” Mohammad said.
Gaurav Ratnaparkhi at Sharekhan said the index received support near last week’s gap area.
“Thereon the index had a sharp rally as the week progressed. And today, it crossed 17,000. In terms of the Technical parameters it has scaled above the 61.8 per cent retracement of the April–June decline and the 200 DMA. Thus, the index can continue to stretch higher as long as it stays above 17,000. On the higher side, it can test 17300 in the short term,” Ratnaparkhi said.
That said, here’s a look at what some key indicators are suggesting for Friday’s action:
US shares look past concerns, end high
US stocks climbed for a third consecutive session on Friday as investors digested strong tech earnings and looked past concerns about high inflation and a recessionary environment. All of the major averages rose to a winning week and their best month of 2022. The Dow Jones Industrial Average advanced 315.50 points, or nearly 1%, to 32,845.13. The S&P 500 jumped 1.4% to 4,130.29, and the Nasdaq Composite added about 1.9% to end the day at 12,390.69. For the week, the Dow ended higher by nearly 3%, while the S&P 500 and the Nasdaq Composite gained about 4.3% and 4.7%, respectively.
European shares shine
European markets closed sharply higher on Friday with shares in France leading the region. The CAC 40 was up 1.72% while Germany’s DAX was up 1.52%. London’s FTSE 100 was up 1.1%. climbing 2.0% since last Friday and 3.5% over the whole of July. The weekly gain came despite a wealth of risk events, including the latest Federal Reserve interest rate decision on Wednesday.
Tech View: Bulls show strength
Nifty50 on Friday climbed for the third straight day and topped the 17,100 level on a closing basis. During the day, the index took out its 200-day simple moving average with a gap-up start earlier in the day, reflecting strength.
F&O: Support shifts higher
Since it’s the beginning of the new series, option data is scattered at various far strikes, said Chandan Taparia of
Securities. Maximum Call open interest (OI) is at 17,500 followed by 18,000 strike while maximum Put OI is at 16,500 followed by 16,000 strike. Marginal Call writing is seen at 17,500 followed by 17,300 strike while Put writing is seen at 16,900 and 16,800 strikes. Option data suggests a broader trading range in between 16,500 and 17,500, Taparia said.
Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade setup on the counters of HDFC Life, Shree Renuka, NHPC, India Energy Exchange,
, and HPCL. The MACD is known for signaling trend reversals in traded securities or indices. When the MACD crosses above the signal line, it gives a bullish signal, indicating that the price of the security may see an upward movement and vice versa.
Stocks signalling weakness ahead
The MACD showed bearish signs on the counters of NOCIL,
, , and V-Guard , among others. Bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.
Most active stocks in value terms
Bajaj Finance (Rs 1,876 crore), Tata Steel (Rs 1,781 crore),
(Rs 1,741 crore), (Rs 1,571 crore), HDFC Bank (Rs 1,430 crore), HDFC (Rs 1,248 crore), Infosys (Rs 1,085 crore) and Sun Pharma (Rs 1,049 crore) and (Rs 421 crore) were among the most active stocks on NSE in value terms. Higher activity on a counter in value terms can help identify the counters with highest trading turnovers in the day.
Most active stocks in volume terms
YES Bank lead the stock in terms of volumes, followed by Zomato, Tata Steel, Suzlon Energy, PNB, Vodafone Idea, Ashok Leyland and SAIL. These stocks were among the most traded stocks in the session on NSE.
Stocks showing buying interest:
PVR, GE Shipping, Rolex Rings, TVS Motor, Coal India, Adani Gas, SKF India, Blue Dart, saw buying interest as they scaled their fresh 52-week highs, signaling bullish sentiment.
Stocks seeing selling pressure
, , , and DRC Systems were some of the stocks seeing strong selling pressure and hit their 52-week lows, signaling bearish sentiment on the counters.
Sentiment meter favours bulls
Overall, the market breadth favoured the bulls, as 2,100 stocks ended in the black, while 1,227 names settled with cuts.