Nifty forms Hanging Man candle

The market bounced from the day’s low, with some of the large-cap and heavy-weight stocks rescuing the index with the smart rally. NSE Nifty is up by 28.45 points or 0.14 per cent and closed at 19,809.60 points. The Bank Nifty and FinNifty declined by 0.55 per cent and 0.23 per cent. The PSU Bank index is down by 1.14 per cent. The Nifty Metal and Media indices were the top losers, with 0.90 per cent and 0.87 per cent, respectively. The Nifty Auto is up by 0.66 per cent, and the IT index is advanced by 0.74 per cent. The Pharma and Energy indices are also up by half a per cent. The India VIX is down by 3.00 per cent to 11.86. The broader market breadth is negative as 1,417 declines and 1,059 advances. About 140 stocks hit a new 52-week high, and 108 stocks traded in the upper circuit. HDFC Bank, GMDC, ICICI Bank, and Reliance were the top trading counters in terms of value.

After the RBI governor’s statement that the Banks and NBFCs must be watchful of stress building up, the market sharply declined in the morning session. The ITC, Infy and Reliance Industries were rescued, and the Nifty smartly recovered. The Nifty recovered over 100 points in the last one hour of trading. It traded in the last Thursday’s range for another day. The Index has formed a Hanging Man candle.

As mentioned earlier. The index must come out of last Thursday’s range of 19,627-875 for a decisive directional bias. There is no change in price structure, as it is still in the range. The index must close above 19,875 with volume support for an uptrend to continue. In any case, if it closes below the previous day’s low, the index will give a first sign of reversal. Even though it moved below the previous day’s low, the last-hour pullback index closed in positive territory. Now, the support has shifted to 19,700 points. Below this level, Last Thursday’s low, the 19,627 points, is the strong support. The 50DMA of 19,590 is the strong support. The ongoing counter trend will end below the 50DMA.