5 Minutes Read
What should investors do if Nifty 50 and Sensex see a gap-up opening
KV Prasad Jun 13, 2022, 06:35 AM IST (Published)
Listen to the Article (6 Minutes)
Summary
Anuj Singhal, Managing Editor of CNBC-Awaaz, advises investors to consider long deals based on the market’s closing on Friday. In a trending market, it’s often suggested to buy during a dip in the 20-day moving average (DMA) or 20-day exponential moving average (DEMA). For Nifty, the 20 DMA stands at 22,404 while the 20 DEMA is at 22,360.
GIFT Nifty is trading 100 points higher amid strong global cues. With the previous week’s closure showing a positive trend on Wall Street, the stage is set for a bullish start to the new week in the domestic market.
Investors are confronted with the question: what actions should they take amidst a gap-up opening?
Anuj Singhal, Managing Editor of CNBC-Awaaz, advises investors to consider long deals based on the market’s closing on Friday. In a trending market, it’s often suggested to buy during a dip in the 20-day moving average (DMA) or 20-day exponential moving average (DEMA). For Nifty, the 20 DMA stands at 22,404 while the 20 DEMA is at 22,360. Accordingly, the recommendation is to maintain positional long deals with a stop loss of 22,300 as soon as the market opens with a gap up. For traders employing the BTST (Buy Today Sell Tomorrow) strategy, it’s advisable to sell half of their positions as soon as the market opens and retain the remaining half.
Amidst positive market sentiment, it’s crucial to analyse the impact of corporate results. ICICI Bank has posted good results, albeit without a significant increase in prices. Conversely, Maruti Suzuki’s results have been weak, potentially leading to a downturn in its stock price. On the other hand, RBL Bank’s results have been excellent, signalling positivity for the market.
Looking ahead, the next significant market indicator will be the auto sales figures for April. Despite market declines during election phases, Prime Minister Modi’s confident body language suggests resilience, with investors using previous falls as buying opportunities. This trend is expected to continue, with potential buying activity during market dips.
Regarding Nifty Bank, key support and resistance levels should be closely monitored. The first support lies between 47,875-48,050 (10 and 20 DEMA), while major support is at 47,400-47,500 (50 DEMA, option zone). First resistance is expected between 48,500-48,700 (Friday’s peak, according to options), with major resistance at 49,000-49,100 (all-time high).
For ICICI Bank, it’s advisable to wait for the 15-minute reaction to the market before initiating trades. A buying zone is identified between 48,150 – 48,300, with a stop loss set at 48,050. Short positions in ICICI Bank and HDFC Bank should be considered only if both show weakness.
Catch the live market updates with CNBC-TV18.com’s blog
Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout
3 Mins Read
Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter
Daily Newsletter
