Nifty trend for Monday and stocks in news: Neogen Chemicals, Biocon, Adani Gas, Dilip Buildcon and Adani Enterprises.

Like people paint their houses before Diwali, the biggest festival of India; similarly, bulls painted the D-Street in green. Nevertheless, right from the start to the end of the last week, the bulls were in driving seat.

Moreover, their dominance can also be judged from the fact that Nifty ended in green for all the five trading sessions of the last week and as a result, it recorded its best weekly gains after the first half of July 2020, ending up by 5.34 per cent.

Further, since it rallied for all the five trading sessions, it resulted in the formation of a sizable bullish bar on the weekly chart. Further, India VIX witnessed a significant decline of 17 per cent on a weekly basis.

Meanwhile, Nifty is now up by nearly 63 per cent from its March lows and is within the striking distance from its all-time high level of 12,430.50. Technically, the index has broken out of the bullish flag pattern along with a ‘breakaway gap’ on the daily chart. There are two important components of the flag chart pattern. The first is the flag pole, which represents a impulse trend on the chart as in Nifty, we had witnessed an impulse move from the low of 10,790. After this impulsive move, a phase of brief consolidation would follow as this consolidation resembles a flag. The first target of the pattern is determined using the measure move technique, the distance of which is equal to the size of the flag. So in the current case, the measured move target of the flag pattern comes near about the all-time high levels on 12,430 as the breakout of the flag pattern is considered at 11,900 and the flag size is of around 500 points. However, the pole target is near the 13,100 level. Interestingly, the upward channel resistance line is placed around the 13,000 levels.

Let’s dig deeper and analyse what we can expect in the coming week on Nifty. The index from a technical standpoint is comfortably placed above its key moving averages, it is currently trading 3.36 per cent above from its 20-DMA. Post last week of June 2020, what we have seen is that the index has mostly moved away nearly in the range of 4.15-5.05 from its 20-DMA, and thereafter, either it reverted to its mean or consolidated. And, Nifty is nearing this threshold. So, all the factors like the flag measure move target, all-time high levels, and the move away from its 20-DMA are indicating that we might move a per cent or two from here on, and then, we may consolidate.

Interestingly, after trading above the long-term moving average i.e. 200-DMA for 79 days, the long-term moving average finally turned up, which is a positive sign. Further, Nifty outperformed Dow as Dollar has weakened. Usually, the weakening of the dollar index is a cheerful time for the emerging markets as we know the love of FIIs for India after they poured handsome amount in the last week, turning net buyers of over 13,000 crore in the last week.

Further, the pied piper of the current rally in the Indian markets has been Bank Nifty as the index jumped 12 per cent in the last week, forming a mammoth bullish candlestick on the weekly chart. A lot would depend upon the heavyweight sector i.e. Bank Nifty for the future course of markets. It has retraced over 62 per cent of the prior sharp fall. The leading sectoral index witnessed a golden crossover as 50-DMA moved above the 200-DMA, which is a long-term bullish sign. The ADX has moved above 33, and the +DMI is above the ADX and –DMI. Further –DMI has reached its lowest level in the last nine months.

Overall, the trend is up but we would advise booking out a profit in the index around the 12,350-12,450 levels. Certain technical parameters are indicating that the index might witness a consolidation phase after hitting the target of 12,350-12,450.

Neogen Chemicals: Based on strong demand and visibility from the global customers, the company has planned an additional Capex of Rs 55 crore at Dahej SEZ plant to be entailed in FY22 for increasing the capacity of organic chemicals.

Biocon: Biocon Ltd said that the board of its subsidiary, Biocon Biologics had approved a capital infusion of Rs 1,125 crore (about $150 million) from Goldman Sachs.

Adani Gas: Adani Group announces strategic collaboration with Snam, Europe's leading gas infrastructure company on energy mix transition.

Dilip Buildcon: The company has been declared as L-1 bidder for the mine developer-cum-operator (MDO) contract for the development & operation of Siarmal Open Cast Project of Mahanadi Coalfield Limited (MCL), a subsidiary of Coal India Limited (CIL) for 25 years.

Adani Enterprises: The company announced that it has commenced commercial operations at Ahmedabad International Airport with effect from November 7, 2020.