Nifty 50 Today: Performance for the day and what to expect going forward
Nifty mirrored the direction of European markets that fell at open and then recovered.
HDFC Securities says that Indian equity benchmark indices ended lower for the third consecutive day on October 30. Nifty 50 opened higher and rose to make an intraday high at about 10 am. It later fell to a low around 1 pm. A weak recovery followed till the end of the session. Nifty mirrored the direction of European markets that fell at open and then recovered. At close, the Nifty was down 28.40 points or 0.24% at 11642.40.
Volumes on the NSE were in line with the recent averages. Auto, FMCG and Bank indices ended in the red while other indices ended in the positive with Realty, Media and Metals gaining the most.
Nifty is tagging the western markets directionally. Hence sentiments need to stabilize in the U.S. / Europe. Improvement in advance decline ratio on Friday is encouraging. While Nifty made a new intraday low, it closed only marginally lower compared to Thursday.
Fresh concerns about the outlook for technology giants fuelled a decline in Asian stocks Friday as shares of Apple suppliers led the tech sector lower. The U.S. tech giant beat earnings expectations on Thursday but failed to offer any guidance for the fourth quarter.
European shares erased declines after a string of positive earnings reports. Data released Friday showed rebounding growth in the third quarter for France. The euro zone’s second-biggest economy grew 18.2% following a revised 13.7% decline in the second quarter
The sideways range movement with negative bias continued in Nifty for the second consecutive session on Friday and the market closed the day lower by 28 points. A small negative candle was formed with upper and lower shadows, which indicate volatility with weak bias in the market.
After showing up-move in the early part of Friday's session, Nifty failed to sustain the gains at the hurdle of 11750 levels and slipped into weakness in the mid part of the session. A smart upside recovery has emerged from the lows of 11535 and Nifty erased most of intraday loss towards the end and closed near the upper end of a range.
HDFC Securities observe back to back weakness in the last two sessions; post the formation of long bear candle of 28th Oct. After the downside range breakout recently, the Nifty struggled to sustain above the hurdle of the range breakout area at 11750 levels, as per the concept of change in polarity. The formation of lower highs of a smaller swing on the daily chart could signal a possibility of further weakness below 11600 levels again.
See Zee Business Live TV Streaming Below:
Nifty on the weekly chart formed a long bear candle and placed at the edge of moving below the significant trend line support at 11600 levels, as per change in polarity. After the upside breakout of this trend line in the early part of October, the Nifty failed to show any meaningful follow through up move later, as it moved in a broader sideways range with weak bias. Hence, this pattern could signal a chance of Nifty showing further weakness in the next week, before showing any meaningful upside bounce.
Conclusion: The short term trend of Nifty continues to be range bound with weak bias. The lower support of 11600-11550 is going to be crucial for the bulls to hold on their defence. A decisive move below this support is expected to open further weakness down to 11200 levels in the next few weeks. Immediate resistance to be watched for the next week is at 11750-11800 levels.
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.