Index trend and stocks in action October 24, 2019

The 50-share index, Nifty, ended the wobbly day with meager gains, but enough to push them slightly above 11,600 mark. Throughout the day, there was a strong tussle between bulls and bears but the market finally closed at the same level where it started in the morning. This led to the formation of a Doji-like pattern. Also, it formed an NR4 bar. An NR4 is a bar with the narrowest range among the last four bars. A regular contraction phase in the market is identified through some patterns, one of which is NR4. After spotting this pattern, traders usually bet that a bigger price movement will follow. The formation of this pattern, just ahead of the weekly expiry, is a clear sign that we are likely to see an expansion phase on the weekly expiry day.

Technically, Nifty has negated the formation of higher highs-higher lows of the last six trading sessions. Nifty has been moving in the range of 11,550 to 11,715 in the last three trading sessions. Thus, going forward, the level of 11,550 is immediate support for the Nifty and a sustainable move below this can create opportunities for further corrections towards 11,450 level. Meanwhile, the level of 11,700-11,715 poses stiff resistance for Nifty on the upside. As long as, nifty stays below this market, we do not expect any runaway rise in the index. A sustainable move and a close above the level of 11,700-11,715 would open up gates for further upside towards 11,780-11,800 level.

Looking at this set-up, we believe Nifty can trade both directions in the coming session, but odds still heavily favor longs, if the level of 11,550 holds. Odds would start to shift if we get a sustainable move below the 11,550 level.

GMR Infrastructure: GMR Infrastructure clarified the news of CCI probe on Hyderabad International Airport business’, stating that it is not material in nature and there is no impact on the company.

Yes Bank: Yes Bank clarified on the news of borrowers failing to pay the dues of around Rs. 480 crores, stating that taking possession of mortgaged properties has been done in the usual and ordinary course of business.

HCL Technologies: The Board of Directors has considered, approved, and recommended the issue of one Bonus Share for every one equity share, held by the equity shareholders of the company.

PVR: PVR has set QIP Floor Price at Rs. 1,809.53 each.

Hindustan Aeronautics: The company has informed that the worker unions at Kanpur, Barrackpore, and Korwa have called off their strike. The strike, however, is continued by the workmen unions at Nasik, Hyderabad, Lucknow, and Koraput.

DHFL: The Board of Directors of the company took cognizance of key observations from the draft report, prepared by KPMG, appointed by Union Bank of India, the lead banker of the consortium. The Board has directed the company to review the aforesaid key observations and also present a detailed response to those before the Audit Committee.