Nifty Breaches 50-DMA; Advance-Decline Ratio at 1:6

Nifty, -2.2%; Sensex, -2.1%; Nifty Midcap, -4.1%; Nifty Smallcap, -4.6%; Model Portfolio, -4%

Market Pulse Uptrend Under Pressure

Distribution Day Count: Six

Nifty, after a flat opening, traded sideways in the first half of the trading session. In the second half, global sentiments weighed on the index, leading to a sharp selloff in the Indian market. Nifty formed lower low in the hourly chart and closed near the day's low, posting significant loss. In the process, Nifty breached its 50-DMA. However, volumes were lower than the previous session, resulting in an escape from an additional distribution day. Furthermore, most of the leaders are still trading above their 50-DMA. Thus, we will closely watch one or two days more before downgrading the market status to a Downtrend. The broader market also felt the heat of bearish sentiment. Nifty Midcap was down 4.1%, while Smallcap closed 4.2% lower.

On the sectoral front, all the sectors closed in the red. Nifty Realty and Metal lost more than 5%. Similarly, Nifty PSU bank, Pharma, Media, and Auto were down 4–5%. Advance-Decline ratio was skewed toward decliners. Out of 2,198 stocks traded, 293 advanced, 1,597 declined, and the rest remained unchanged.

As the market is in an Uptrend Under Pressure, investors should proceed ahead with caution. Unless a stock shows exceptional fundamental and technical strength, no new addition to the portfolio is advised. Investors should consider booking profits in stocks that have performed well and have advanced 20–25% from their ideal buy points.

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