Nifty50 on 3 December
Indian stock market’s benchmark index Nifty50 extended its gaining momentum for three consecutive sessions. The index gained around 181 points or 0.75% and formed a bullish candle with a higher-high and higher-low price structure. It started the session on a positive note at 24,367.50 and made an intraday low at 24,280. However, strong buying in PSU banks, energy, metal, and BFSI stocks lifted the index to 24,481.
FMCG stocks underperformed after the group of ministers (GoM) on GST rate rationalization recommended raising the tax on aerated beverages, cigarettes, tobacco, and related ‘sin’ products to 35%. The advance-decline ratio was in favour of the bulls (3:1).
Technically, the index was facing strong resistance around 24,400 for the past six trading sessions. On Tuesday, it broke out above this level and surpassed the trendline, connecting the high of 6 November 2024 to that of 28 November 2024.
The momentum indicator, the 14-period relative strength index (RSI), is trending slightly upward and currently placed at 56. Another technical indicator, moving average convergence/divergence (MACD), is trending with a positive crossover but is still below the central line.
Moving forward, the 50- and 100-DMA, currently placed around 24,625 and 24,700, respectively, are the key levels to watch in the coming days. The ongoing trend indicates that the bullish trend is likely to continue in today’s trading session. Sustainable trading above 24,400 may lead the index toward 24,700–24,800 in the coming days. However, a failure to hold above 24,400 may result in volatility in the sideways zone.
According to O’Neil’s methodology of market direction, the current market status is in a “rally attempt”. A rally attempt begins on the third day when the index closes higher off the most recent bottom after being in a correction (also known as a downtrend).
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How Nifty Bank Performed
This major sectoral index opened on a positive note and remained in positive territory through the day. On Tuesday, the index formed a bullish candle with a higher-high and higher-low price structure and is trending comfortably above all its key moving averages. On Tuesday, the index opened at 52,358, traded in the range of 52,781–52,217, and closed at 52,696.
The momentum indicator, RSI, is trending in the flat zone and is currently placed at 60, along with a positive crossover on MACD. Another trend directional indicator, the average directional index (ADX) also suggests a bullish trend. Currently, the index is comfortably holding above 52,500 along with improved momentum on the daily chart. The ongoing trend in this index suggests that it may remain buoyant above 52,500 and may lead the index toward 54,000 in the coming trading sessions.
According to O’Neil’s methodology of market direction, the current market status is in a“confirmed uptrend”. The uptrend begins with a follow-through day or when the index reclaims its previous uptrend high.
Read more | Bank Nifty’s rebound: A signal for market outperformance?
Two stocks to buy, recommended by MarketSmith India:
● ICICI Bank: Current market price ₹ 1,308.40 | Buy at ₹ 1,280–1,310 | Profit goal ₹ 1,530 | Stop loss ₹ 1,208 | Timeframe 1–2 months
● Inox Wind: Current market price ₹ 206.56 | Buy at ₹ 200–208 | Profit goal ₹254 | Stoploss ₹ 186 | Timeframe 2–3 months
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.
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