Here is how analysts read the pulse of the market:-
Gaurav Ratnaparkhi, Head of Technical Research at Sharekhan, said Nifty50 got support near the crossover of the 4-week moving average and the lower weekly Bollinger Band in the penultimate week.
Mazhar Muhammad from Chartviewindia.in said that Nifty50 appears to have recorded a decisive breakout from its 32-day-old descending channel with a close above the 50-day exponential moving average.
However, here’s a look at what some of the key indicators for Monday’s action suggest:
Wall Street ended the turbulent year near record levels
Wall Street closed near record levels in light trading on Friday, the last trading day of 2021, marking the second year of recovery from a global pandemic.
All major US stock indexes posted monthly, quarterly and annual gains, making their biggest advance in three years since 1999.
The S&P 500 is up 27% since the last trading day of 2020. As of Thursday, the benchmark index had hit 70 record closes, or the second most ever. Using Refinitiv data going back to 1928, the S&P 500’s highest record close in a single year was 77 in 1995. The Dow Jones added 18.73% for the year, and the Nasdaq gained 21.4%.
European shares post their second best year since 2009, gaining 22%
European shares fell on Friday despite ending the year on a higher note, amid mounting COVID-19 infections worldwide and concerns about the pace of the global economic recovery from the pandemic. Volumes were thin, with many traders exiting and most major European exchanges closed, except for London and Paris which had shorter trading sessions. The pan-European Stoxx 600 index fell 0.1 percent, as retail stocks led losses. The benchmark index is up 1.3% this week.
However, the overall European index finished up 22%, its second best year since 2009, with all major sub-sectors posting annual gains.
Banks and technology stocks recorded the biggest rise this year, adding 34% each, while epidemic-hit travel stocks underperformed, with gains of 4%.
Technology opinion: An uptrend is likely
Analysts said that Nifty’s closing above 17,350 points could help it maintain positive momentum in the coming days. They suggested that if the Nifty50 index continues above the 17238 level, it may head much higher with an initial target of 17,500 points.
F&O: A bullish trend ahead
In the derivatives sector, traders aggressively bought out-of-the-money options for the Nifty50 index, indicating their upward trend in the upcoming sessions. Traders added strong positions at the 17.700 strike price indicating that they expect the index to test this level soon.
Stocks are showing a bullish bias
The Moving Average Convergence Divergence (MACD) indicator showed a bullish trade setup on the IDFC First Bank, NALCO, Tata Motors, Aditya Birla Capital, ITC and GIC counters.
MACD is known to indicate trend reversals in stock or traded indices. When the MACD crosses above the signal line, it gives a bullish signal, which indicates that the price of the security may experience an upward movement and vice versa.
Arrows indicate weakness in the future
MACD is showing bearish signals on the HCC, Parsvnath Developers, Future Enterprises, LT Foods and Birla Tires counters. A bearish crossover on the MACD on these counters indicates that they have just started their bearish journey.
Most active stocks by value
RBL (Rs.1,107 crore), RIL (Rs.1,037 crore), Vodafone Idea (Rs.946 crore), Infosys (Rs.872 crore), Hindalco (Rs.860 crore) and IDFC (Rs.766 crore) were among the top stocks. Activity on Dalal Street by value. The highest activity on the counter by value can help identify the counters with the highest turnover per day.
Most active stocks by volume
Vodafone Idea (shares traded: Rs 63.6 crore), IDFC (shares traded: Rs 12.4 crore), RBL Bank (shares traded: 8.7 crore), YES Bank (shares traded: Rs 7.3 crore), IDFC First Bank (shares traded: Rs 7.3 crore) Shares traded: Rs.4.9 crore) and Suzlon Energy (Number of shares traded: Rs.4.5 crore) was among the most traded stocks of the session.
Stocks are showing buying interest
MTAR Tech, eClerx, Tata Tele, Narayana Hrudayalaya, Suzlon Energy and Easy Trip Planners saw strong buying interest from market participants as they surged to new 52-week highs, indicating bullish sentiment.
Stocks are under selling pressure
RBL Bank, HEC Infra Projects and DCM Shriram saw strong selling pressure and hit 52-week lows, indicating a downtrend on these counters.
Feelings meter prefer bulls
In general, the breadth of the market was in favor of the gainers as 386 stocks closed in green on the BSE500 index, while 114 stocks settled with cuts.