Stock Market Daily Updates: 22 Feb 2021

Traders should now become cautious while trading momentum & continue their bullish strategy until nifty holds above 15008-15088 levels could take the Nifty 15202 over the next few days. On falls, 14888-14808 levels could act as good support in the near term.

Dear Trader…

One more negative session witnessed on the street as Indian benchmark equity indices ended lower with selling pressure seen across the sectors and the market is expected to continue on bearish momentum based on current price action, once the same break below the current key support holding near 14909 levels. Alternatively, if the market struggles to break the support, then it might retest the same and revise the trend to bullish mode once again.

Asian stocks pulled back from all-time peaks on Friday as higher longer-dated bond yields and disappointing U.S. jobs and economic data dented investor confidence in a faster economic recovery from the COVID-19 pandemic. 

Eurozone shares rose on Friday as data showed factory activity in February jumped to its highest in three years. Strong demand for manufactured goods helped the factory PMI soar to 57.7 from 54.8, the highest since February 2018 (vs 54.3 forecasts). A PMI covering the euro zone’s services industry fell to 44.7 from January’s 45.4 (vs 45.9 forecasts). IHS Market’s flash composite PMI registered 48.1 in February compared to January’s 47.8 and 48 forecasts.

The Indian stock market has risen more than an estimated 80% since last April so caution will now be needed as the financial sector stabilizes in the coming days and valuations in the Indian equity market are high; the RBI also said that the rally was due to liquidity from foreign investors.

The UBS Securities report also said that US and British investors are focusing on India's medium-term growth potential and are optimistic, while Asian investors are expressing concern over the high valuation of the market.

FIIs made heavy purchases in the Indian equity market in the December quarter and made the highest quarterly investment ever. 

The market continues to grow due to the success of the vaccination program but has seen a correction in the bullish phase in the past, as well as FIIs, continued to buy aggressively, but local institutional investors have so far seen net sales in the December quarter, the reason is redemption and to some extent, many investors prefer to invest directly in equities which are also affecting inflows.

The sentiment of foreign investors is positive that the Corona situation in India has come under control and it has also boosted confidence in the economy. UBS Securities has projected the fastest recovery of the Indian economy in Asia in FY2021-22.

The record-breaking rally in the last two weeks has been calming down with the massive buying figures of foreign portfolio investors in the Indian stock market now disappearing, but caution will be needed in the coming days as fund-giants continue to buy in the market.

In my opinion, it would be advisable to book profits in every bullish stock as the market has reached an all-time high with an unprecedented historic rally in just one year after the Corona epidemic and the Indian stock market will also be keeping a close eye on the situation, with petrol and diesel prices reaching record highs.

Traders should now become cautious while trading momentum & continue their bullish strategy until nifty holds above 15008-15088 levels could take the Nifty 15202 over the next few days. On falls, 14888-14808 levels could act as good support in the near term.

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Ø INDEX MOVEMENT - 22.02.2021

• Nifty Future closed @ 14987 as on 19.02.2021

Nifty Future has resistance at 15088 – 15133 Point; above which other resistance levels are at 15188 – 15202 Point with highly Volatile Trend,

Nifty Future has Downside support levels are at 14909 – 14870 Point; below14870 Point, other support levels are at 14838 – 14808 Point.

I am positive for the next bullish trend only above @ 15202 Point but be with the trend. Let the market decide further moves.

As we are saying from many days, Buying is suggested in falls only...and it’s still a better strategy in the given Scenario.

Regarding Long term positions, it is preferable to remain cautious now.

If Nifty Future crosses @ 15202 Point, again then the upper side target is quite high and it may touch @ 15232 Point in the short term.

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• Bank Nifty Future closed @ 35849 as on 22.02.2021

Bank Nifty Future has resistance at 36008 – 36188 Point; above which other resistance levels are at 36303 – 36474 Point with highly Volatile Trend,

Bank Nifty Future has Downside support levels are at 35707 – 35575 Point; below35575 Point, other support levels are at 35404 – 35272 Point.

I am positive for the next bullish trend only above @ 36474 Point but be with the trend. Let the market decide further moves. 

As we are saying for many days, Buying is suggested in falls only...and it’s still a better strategy in the given Scenario...!!!

Regarding Long term positions, it is preferable to remain cautious now...!!

If Bank Nifty Future crosses @ 36474 Point, again then the upper side target is quite high and it may touch @ 36606 Point in the short term...

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Disclaimer: The views expressed in the article above are those of the authors and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.