Sentiment Indicator

200-DMA INDICATOR :
This indicator measures the percentage of Nifty 50 stocks that are trading above/below their 200-day simple moving averag-es. The 200-DMA is considered important as it is one of the basic technical indicators that can be used to determine the long-term trend of security. Almost 92 per cent of the stocks that constitute Nifty 50-the equity benchmark index are trad-ing above their 200-DMAs while 8 per cent of the stocks are trading below their 200-DMAs. On a WoW comparison basis, we observed that 6 per cent of the stocks of Nifty have surged above their 200-DMAs. In the last five trading sessions, Bajaj Auto, Maruti Suzuki India, and Mahindra & Mahindra have surged above their 200-DMA. The benchmark index Nifty has gained nearly 600 points or 3.38 per cent from month-to-date.

The index has marked a fresh all-time high of 17,947.65 level. Along with this upward journey, almost 6 per cent of the con-stituents of the index have surged above their 200-DMA on an MoM comparison basis. In the month of August, on average, 80 per cent of the stocks were trading above their 200-DMA while in the current month, on average, 86 per cent of the constituents were trading above their 200-DMA. However, in the last five trading sessions, Nifty index has gained 164.65 points or nearly 1 per cent. The stock of Indus Towers and Coal India were the top gainers of the last five trading sessions as they have gained over 14 per cent. From the all-time high level, the index has witnessed a correction of nearly 1.31 per cent. Despite that, we have seen an addition in stocks moving above their 200-DMA. This clearly indicates that the index is witnessing consolidation but individual stocks’ picking and dumping are underway. 

Sectoral Sentiment Indicator :
This indicator basically interprets the number of stocks in the sectoral indices trading above/below their 200-day moving averages. This will help us to know which sectors are improv-ing their performance. On a WoW comparison basis, the sectoral index Nifty Auto has seen significant improvement as 20 per cent of the stocks have surged above their 200-DMAs, followed by Nifty PSU Bank, where over 15 per cent of the stocks have moved above their 200-DMAs. Among the constituents of Nifty Bank index, almost 8.33 per cent of the stocks have surged above their 200-DMA. On the flip side, Nifty Media has witnessed some profit booking from the high-er levels after the strong upward move. Nifty Media index has witnessed a correction of over 5 per cent from the high of Rs 2,282.05 level. Along with this correction, almost 10 per cent of the constituents of Nifty Media index have slipped below their 200-DMA.

Among the constituents of Nifty Financial Services and Nifty FMCG index, almost 10 per cent & 6.67 per cent, respectively stocks slipped below their 200-DMA. The ratio of stocks moving above/below their 200-DMA of Nifty IT, Nifty Metal, Nifty Pharma, Nifty Private Bank, and Nifty Realty indices remained unchanged on a WoW compar-ison basis. In line with our expectations, Nifty Realty index has continued its upward journey as it gained 11.39 per cent in the last five trading sessions. Currently, Nifty Realty index is trading above its 200-DMA by nearly 44 per cent. From the low of Rs 10,021.35, Nifty Auto index has gained over 6 per cent and currently, it is on the verge of giving a breakout on the weekly chart. Currently, almost 67 per cent of the constituents of Nifty Auto index are trading above their 200-DMA and the index itself is trading above its 200-DMA by nearly 5 per cent. In the last five trading sessions, the difference between 200-DMA and the closing of Nifty Auto index has increased significantly, which is a bullish sign

Indicator To Gauge Internal Strength :
This indicator helps us to gauge the internal strength of the market. Among Nifty 500 stocks, a higher number of stocks reaching 52-week highs and the lesser number of stocks hit-ting 52-week lows represent a bull market while the opposite, suggests a bear market. On a WoW comparison basis, the previous week's average ratio of stocks marking a new 52-week high/low was 34:0 and in the current week, the average ratio is 43:0 where, on average, 43 stocks touched a new 52-week high. On the flip side, on average, not a single stock has hit a fresh 52-week low. Month-to-date (MTD), Nifty 500 index has gained over 530 points or nearly 4 per cent. In this month, the index has surged above its psychological mark of 15,000 and marked a fresh all-time high of 15,305.20 level.

This is clearly visible in this indicator as on an MoM comparison basis, on average, the stocks marking a 52-week high have surged nearly 58 per cent. While on the flip side, we have seen a significant decline in the stocks marking a 52-week low as compared to the prior month. In line with our expectations, Nifty 500 index has slid into a period of consolidation. From an all-time high level, the index has witnessed a correction of nearly 218.25 points or 1.42 per cent in the last four trading sessions. Despite this, the stocks marking a 52-week high have increased by 26 per cent on a WoW comparison basis. This clearly indicates that the index has slid into consolidation but stock-specific action still continues. 

(Closing price as of Sept 29, 2021)