After The Bell: Bulls make a comeback, what should investors do on Monday?

Market Outlook
PNB Gilts | Rating agencies ICRA and CRISIL on March 16, 2021, reaffirmed the credit ratings of

PNB Gilts | Rating agencies ICRA and CRISIL on March 16, 2021, reaffirmed the credit ratings of “ICRA A1+” and “CRISIL A1+”, respectively, assigned to Rs 1,000 crore commercial paper programme of the company. The announcement was made post market hours, so the stock did not react to the news development. It closed 1.26 percent lower at Rs 50.80 on March 16. It hit a 52-week high of Rs 61.45 on February 8, 2021, and a 52-week low of Rs 21.50 on March 23, 2020. The market-cap of the company stands at Rs 914.45 crore. In terms of technical charts, the current rating by Moneycontrol on the stock is ‘neutral’. The important support levels for the stock are placed at Rs 50.97 and Rs 50.48, while resistance is placed at Rs 52.22 and Rs 52.98, data on showed. (Image: Shutterstock)

Bulls managed to bounce back on March 19 after five days of selloff, pushing the Nifty50 back above 14,700 and the S&P BSE Sensex briefly above 50,000. The Sensex finally closed at 49,858, up 641 points, while the Nifty gained 186 points to end at 14,744.

Sectorally, buying was seen in power, utilities, energy, FMCG and metal stocks, while realty and capital goods saw mild profit-taking.

On the broader markets front, the BSE midcap index was up 1.3 percent and the smallcap index gained 0.4 percent.

“The highly volatile domestic markets witnessed a smart recovery from its morning weakness and was swinging between gains and losses during the day owing to strong buying in FMCG, pharma and energy stocks,” Vinod Nair, Head of Research at Geojit Financial Services told Moneycontrol.

“However, auto stocks were under pressure after the announcement of the government’s new scrapping policy. The unsettling pace of US bond yields and a surge in COVID cases worldwide resulted in the global markets trading deep in the red,” he said.

Here is what experts are suggesting investors should do on March 22:

Chandan Taparia, Vice President | Analyst-Derivatives, Motilal Oswal Financial Services Limited

The Nifty formed a bullish piercing candle on the daily scale and again reclaimed to its 50-DEMA. It continued forming lower-highs but closed positive after five trading sessions.

The index has to decisively hold above 14,700 to witness an upmove towards 14,900 and 15,000, while on the downside, immediate support exists at 14,600 then 14,450.

Rohit Singre, Senior Technical Analyst at LKP Securities

The index closed the day on a positive note at 14,745, gaining more than a percent, and formed a bullish piercing candle pattern on the daily chart which stands for a bullish reversal.

Once the Nifty crosses the 14,800 zone, the bullish piercing pattern will get active and we may see a good move towards the immediate hurdle zone of 14,900-1,5000. On the downside, supports still exist at the 14,650-14,580 zone.

Ashis Biswas, Head of Technical Research at CapitalVia Global Research Limited

The Nifty witnessed some swift recovery from its short-term support of 14,400. The expected range is between 14,600-14,900.

Technical evidence still supports range-bound trade. Investors should adopt a buy-on-dips approach. Multiple momentum indicators are not confirming their bias. Lack of weight of evidence indicates a sideways market structure is likely.

Gaurav Ratnaparkhi, Senior Technical Analyst, Sharekhan by BNP Paribas.

The Nifty started the day on a negative note and tested the lower end of a sideways channel. Also, the hourly chart shows that the index tapped at the lower end of the dynamic falling channel. From these channel supports, the Nifty bounced sharply.

It has broken out from the falling channel on the hourly chart. On the daily chart, it has formed a piercing line, a bullish candlestick pattern.

The overall structure shows that the index is recovering from the lower end of the consolidation range and can head towards the upper end.

Going ahead, 14,800 will be the immediate hurdle, beyond which the index can move towards the 15000-mark.

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