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The market condition is a 'SELL' on rallies. Nifty needs to move above 14,950-15,000 for the market to move higher, says an expert
India’s Benchmark indices slumped to a 10-week low on April 12 as worries over surging COVID-19 cases in the country spooked investors and fears of lockdown and additional curbs dampened sentiment. There was a broad-based sell off and all the sectoral indices ended with heavy losses.
The overall market cap of BSE-listed firms fell to Rs 200.9 lakh crore from Rs 209.6 lakh crore in the previous session on April 9, making investors poorer by Rs 8.77 lakh crore in a day.
The S&P BSE Sensex plunged 1,707.94 points or 3.44% to close at 47,883 and the Nifty50 dragged 524 points or 3.53% to close lower at 14,310.
This is the second-biggest single-day fall for Sensex in 2021. On February 26, 2021, Sensex had ended 1,939 points at 49,099, posting its biggest single-day fall this year.
Broader markets, on the other hand, faced an even severe blow with the S&P BSE MidCap and SmallCap indices dropping 5% each.
All sectoral indices ended in the red with the PSU bank index shedding over 9%, the realty index fell 7.7%, while power, metal, capital goods, bank, and auto indices slipped 4-5%.
As for stocks, only one on the Sensex (Dr Reddy’s Labs) and four on the Nifty ended the day in the green.
Tata Motors, Adani Ports, IndusInd Bank, Bajaj Finance and UPL were among major losers on the Nifty, while gainers were Dr Reddy’s Laboratories, Cipla, Divis Labs and Britannia Industries.
India VIX, the market’s volatility gauge, surged 16.17% to 22.99 on Monday, signalling heightened negative sentiment on Sensex and Nifty.
Here’s how experts see markets trading tomorrow
Manish Shah, Founder, Niftytriggers.com
Nifty failed to break above 15,000 and we see a wide range candle that gapped lower. As the gap is from a consolidation it can be classified as a breakaway gap. Nifty breaks below the rising trendline of the last several months. Furthermore, the support at 14,300 is taken out. A distinct pattern of lower highs and lower lows is seen.
The slope of the moving average has turned negative and this indicates that the market is turning lower. The Nifty volatility squeeze that was seen in the last two days seems to be resolving on the downside.
With this, the trajectory has turned down and Nifty is likely to see a decline to a pre-budget low of 13,500-13,400. Any short-term rallies should be used as an opportunity to sell. The market condition is a ‘SELL’ on rallies. Nifty needs to move above 14,950-15,000 for the market to move higher.
Gaurav Ratnaparkhi, Senior Technical Analyst, Sharekhan by BNP Paribas
The Nifty opened the gap down & witnessed follow-through selling as the day progressed. It tumbled down to test the swing low of 14,264.
The Fibonacci retracement shows that the index went down to hit the 61.8% retracement of the February rise once again. Also, the Nifty approached a trendline drawn from the previous crucial swing lows.
All these parameters offered support for the day. These parameters are in the range of 14200-14300. Unless these levels break on a closing basis, the index can still stay in a consolidation phase. 14,200-14,700 will be the new short-term range for the index.