Index trend and stocks in action on March 24, 2020
On Monday, it was the second instance of trading halt in Indian market, in a span of 10-days. Earlier, on March 13, Nifty hit lower circuit in the opening deals for the first time since May 2009. After resumption, the markets showed no inclination to recover and Nifty tanked a whopping 1,135 points or almost 13 per cent to record the worst ever single day fall with all the 50 constituents ending in red. The fear gauge India VIX jumped 6.64 per cent to 71.99 levels.
The price action of the day formed a sizable bear candle with a gap down opening with a long upper shadow. For the first time since the last three week’s declining phase, Nifty has formed a higher high and higher low on a closing basis on Friday but on Monday, Nifty breached its Friday’s low and made a new low of 7,583.60. So, Nifty maintained its rhythm of not closing in green for two consecutive sessions since February 12, 2020. Now, it seems that Nifty is approaching towards the level of 7,342 which is 50 per cent retracement of the super bull cycle that started in 2008. However, if the bulls are unable to hold this support, in that case, Nifty may slide towards the 2016 low of 6,825 followed by 6,350 levels, which is an ascending triangle breakout level when Prime Minister Narendra Modi came to power.
The RSI on the daily chart stands at 19 and it show a bullish divergence as a new low in price is made while the RSI value is not making a new low. However, trading based on the bullish divergence in isolation is not appropriate.
Dr Reddy’s Laboratories: The meeting of the board of directors of the company is scheduled on March 27, 2020 inter alia, to consider and approve raising of funds through the issuance of commercial papers.
Hindustan Unilever: The company has today signed an agreement with Glenmark Pharmaceuticals Ltd to acquire its intimate hygiene brand 'VWash'.
Dabur: Dabur to suspend production at manufacturing units till March 31, except for essential products like Ayurvedic medicines, Chyawanprash, hand sanitizers, hand wash, etc.