Weekly Trend Report
- 21st October 2024
Week Gone By
The Indian benchmarks witnessed substantial losses during the week, extending their losing streak for the third consecutive week. The indices were lower for three out of five trading sessions. The BSE Mid-Cap index and BSE Small-Cap index fell. In the week ended on Friday, 18 October 2024, the S&P BSE Sensex tumbled 156.61 points or 0.19% to settle at 81,224.75. The Nifty 50 index declined 110.20 points or 0.44% to settle at 24,854.05. The BSE Mid-Cap index fell 0.18% to close at 56,600.05. The BSE Small-Cap index declined 1.01% to end at 47,946.53. On economy front, India’s wholesale price index (WPI)-based inflation rose to 1.84% in September as food items, especially vegetables, turned costlier, as per the government data released on Monday.
Week Ahead
Investor are gearing up for a week filled with corporate earnings and global market dynamics. The second-quarter results (Q2FY25) for Indian companies will be a key focus, potentially influencing sectoral trends. Meanwhile, global stock market movements, the rupee’s exchange rate, and crude oil prices will also play pivotal roles in shaping the market’s direction. Investors will be closely monitoring the activities of foreign portfolio investors (FPIs) and domestic institutional investors (DIIs) to gauge their sentiment. On the macro front, HSBC India PMI data for October will release on Thursday, 24 October 2024. In the global market, United States Durable Goods Orders data for September will release on Friday, 25 October 2024.
Technical Overview
- The Nifty50 began the trading week positively; however, due to shorter-term moving averages acting as overhead resistance, selling pressure led to a decline throughout the week.
- The index tested pivot supports in the zone of 24750-24650 and experienced a slight recovery on Friday.
- The VIX decreased by 1.38% for the week.
- The trading week concluded with most broader and sectoral indices under pressure but showing improved momentum compared to the previous week, indicating a positive development.
- The market breadth concerning short-term trends exhibited deterioration, as the number of stocks trading above their 10 and 20-day moving averages failed to sustain above median levels. The number of stocks above the 10-day moving average dipped below those above the 20-day moving average.
- The larger trend remains steady, with stocks trading above the 50 and 200-day moving averages maintaining their positions above median levels. However, further improvement in stocks above the 200-day moving average is necessary for a healthier market.
- Toward the end of the week, the momentum market breadth showed a declining trajectory, and market breadth volumes indicated reduced stock participation, resulting in a more selective market environment.
- Moving forward, the behavior of the Nifty against the 25000-25100 zone is significant, given that the 25100 aligns with the 50-DMA, while the 25000 level is a psychologically important threshold.
- The upcoming week may begin subdued, with levels of 25100 and 25440 serving as potential resistance points.
- The 24750-24650 zone is anticipated to provide immediate and firm support, and sustainability above it could strengthen bullish conditions in the index.
- Conversely, failure to hold above this zone may lead the Nifty to address the former gap-down area until 24300. The overall swing confidence is rated at 25 out of 100, indicating a need for portfolios to adopt minimal acceptable risk.
To view the detailed report click here to Download
