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Edelweiss Technical Reflection (ETR)
- The index opened on a flat note and soon entered a phase of gradual selling; which amplified in the final hour as important hourly supports were breached with substantial volumes. The intraday downward sloping channel has been invalidated and a deeper retracement is expected on the index. The earlier breakaway gaps are now getting filled indicating a lack of buying support. Hourly momentum indicators have rolled bearish along with a couple of daily oscillators turning lower too, a sign of further downside risk in the near-term. Market breadth turned sour, as declines doubled against the advances. Nifty index saw two declining stocks against one advancing stock. Nifty is expected to find support at 6150 (21 DEMA), which if breached with force is likely to target deeper retracement levels at 6090 under a bearish momentum indicator signal.
§ All the sectoral indices closed in the negative. Realty, Oil & Gas and Telecom stocks were among the biggest losers yesterdays, whereas Consumer Durables, Power and Metal shares outperformed the index. Banking shares are witnessing a short-term reversal as the oscillators roll bearish from overbought levels. Bullish Setups: TATA, CHMB, RPWR, HNDL. Bearish Setups: BHEL, HPCL, GSPL, RBXY, MSEZ
§ Gyrations in the US Dollar (DXY) are sending shivers across risk assets globally. Western equity indices have are trading down ~2% from recent highs triggering near-term correction. Short-term oscillators too have rolled bearish indicating some downside risk. DXY is building on previous gains, forming higher top higher bottom on daily charts. Momentum oscillator on daily and weekly charts has triggered a buy indicative of a sustainable upmove towards 80.15.
§ Interesting chart setups: TATA, LT, ITC, HPCL, BHEL
Sales Traders Commentary
§ On Thursday, key benchmark indices tumbled as investors remained cautious ahead of the outcome of meetings of G-20 world leaders in South Korea on Thursday and Friday. Telecom, banking, IT FMCG and capital goods stocks fell. The Sensex plunged on aggressive selling pressure seen in index pivotals. Realty stocks fell the most followed by oil & gas and telecom, and banking stocks.
§ The Sensex dipped 287 points to 20590 while the S&P CNX Nifty shed 81 points to close at 6194.
§ Gainers were Hindalco Industries (2.19%), Tata Power Company (1.42%), Reliance Energy (0.73%), and Mahindra & Mahindra (0.30%).
§ Losers were D L F (4.52%), Jaiprakash Associates (3.74%), Cipla (3.63%), Bharti Airtel (3.31%), Bharat Heavy Electricals (2.93%), and Tata Consultancy Services (2.68%).
§ The Realty index was down 3.5%. Major losers were D L F (4.52%), Housing Development and Infrastructure (4.34%), Indiabulls Real Estate (2.82%) and Ackruti City (0.61%).
§ The Oil & Gas index dipped 2.04%. Major losers were Essar Oil (2.3%), G A I L (India) (2.15%), Bharat Petroleum Corporation (1.16%), Cairn India (1.02%), and Aban Offshore (0.81%).
§ The Telecom index was down 1.67%. Major losers were Bharti Airtel (3.31%) and Idea Cellular (0.94%).
§ The Bankex was down 1.63%. Major losers were Federal Bank (4.6%), Bank of India (3.52%), H D F C Bank (2.4%), Canara Bank (1.57%), and Bank of Baroda (1.4%).
§ Globally, Asian indices ended mixed while European indices were trading flattish.
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