Celebration time on D-Street: Nifty hits new all-time high; Nifty FMCG & IT shine

Market Update at 11:00 AM: It’s celebration time on D-Street as Nifty has logged a fresh all-time high and it is trading with gains of over half a per cent and is also, within the striking distance of an important landmark of 16,000. 

Nifty has surpassed its earlier all-time high of 15,962.25, which was registered on July 16. Meanwhile, the action in the broader market is subdued. As a result, the broader indices were seen underperforming the frontline indices.   

Among the sectoral indices, Nifty FMCG has emerged as the top gainer, followed by Nifty IT and Nifty Pharma.   

On the options' front, massive open interest addition is seen in the 15,900 put option on Tuesday as nearly 49.69 lakh shares have been added in the open interest. On the other hand, unwinding has been witnessed in the 15,900 call option. Besides, PCR stands at 1.47.  

SGX Nifty is indicating a soft start for the domestic markets as it is down by 48.50 points and thereby, hinting that Nifty may open around 15,862.50 levels.    

Nifty started off the week on a buoyant note and thereafter, it spent the majority part of the trading session within a range but managed to close near its day's high at 15,855. Interestingly, all the sectoral indices ended in green on Monday with Nifty Realty and Nifty Energy being the top gainers. The broader markets continued to outperform the frontline indices as Nifty Midcap 100 and Nifty Smallcap 100 rose 1.56 per cent and 0.91 per cent, respectively.   

The price action of the day formed a small-bodied bullish candle with a long lower shadow on the daily chart. Nifty has not reclaimed its 20-DMA but interestingly, it has recorded its best closing ever since July 19. The index is now placed in the gap area of July 19 and also, it is near the swing high of July 23.   

Going forward, the opening of the index and price action thereafter would be important to watch out for. A failure to move above this region would result in a decline towards the levels of 15,700 while sustaining above the current levels would indicate that the bulls would attempt to break through the upper band of resistance, which is placed in the region of 15,950-16,000. Until this happens, traders should focus on stock-specific action.   

The RSI also closed above the prior swing high. The MACD histogram shows a decline in the bearish momentum.