It was a truncated week but it was full of action where we saw a strong tussle between bulls and bears. Nifty and Sensex started Monday with new highs of 13777/47055 respectively but on the same day we have seen a sharp fall on the back of worries of a new strain of Covid19 from the UK where Nifty has fallen more than 600 points and Sensex has fallen more than 2000 points at one point of time but then as Stock Market observed that this issue is not so serious which made Bulls comeback aggressively where market rallied for three consecutive days.
At the end of the week, Nifty and Sensex ended on a flat note whereas Sensex continues its 8th-week winning streak while Nifty ends with a minor loss of 0.08%.
What is stored in the data?
If we talk about cash market data then Foreign Institutional Investors are continuing their buying momentum where they bought around 2591 cr, though momentum has slowed down because generally FIIs’ flow remains muted around the Christmas and New Year holiday and we are expecting tepid flow in next week as well. DIIs are still in a selling mode where they sold around 3400Cr.
In the F&O market, FIIs’ long exposure in the cash market stands at 68% which is a comfortable level whereas PCR stands at 1.75 mark which is a little overbought level.
What do the technical charts say?
As we discussed last week that 13770-13820 is a critical supply area for the Nifty where we have seen a sharp fall from there but Nifty respected its 20-DMA and then witnessed smart pullback but it is still stock trading below the 13770-13820 zone where if it manages to cross 13820 levels then we can expect a strong rally and Nifty can easily cross 14000 marks. On the downside, 13550 is an immediate support level while 13415 is 20-DMA which remains critical support on a closing basis.
If we talk about Banknifty then 30800-31000 is a critical supply zone but if it manages to take out this zone then we can expect a strong rally towards the 31500/32000 level or even it can head towards its all-time high. On the downside, 30000 is an immediate and strong support level while 29000 is critical support on the downside.
Cues for next week:
F&O expiry: The market can remain volatile due to the December month F&O expiry.
- Monthly Auto Sales Numbers: We will have a December month auto sales number which will have an impact on auto stocks and the overall market.
- Covid-19 cases and Vaccine related news: Covid-19 cases and Vaccine related news will continue to impact our market.
The most important clue for the Next week will be that we are going to say bye-bye to the most uncertain year 2020 and we are going to welcome 2021 full of positive energy.
So wishing you all on behalf of the Swastika family: “A very Happy, Healthy, Peaceful and a Prosperous New Year.”