Market reacts to second wave of covid-19 in our country : Angel Broking
(Time Zone: Arizona, USA)
Market Wrap-up by Mr. Ruchit Jain (Senior Analyst - Technical and Derivatives, Angel Broking):
"Our markets started the week with a gap down on back of worries over rising cases of Covid-19 in our country in this second wave. Our markets completely ignored the global cues today and post the gap down, we witnessed a sell-off across and ended the day tad above 14300, with a deep cut of over three and a half percent.
The rising cases of Covid -19 and a fear of probable lockdown in some parts of the country led to a sell-off in our markets which resulted in a huge under performance compared to the global peers. Post the gap down, there were no major pullbacks during intraday and the Nifty even breached 14250 mark in the last hour before ending the session tad above 14300. Nifty has breached its 'Rising Trendline' support and has ended around the 25th March swing low. The range of 14264-14240 is the immediate support zone which is the swing low and the '89 day exponential moving average'. Below this, the retracement support comes in the range of 14070-14000. Although the index is nearing its important levels, it would be prudent to avoid aggressive bets and watch for the price momentum as the broader markets have witnessed sharp sell-off. On the flipside, 14465 and 14590 would now be the immediate resistances on pullback moves.
The Banking and Financial stocks which have good weightage in the Nifty index as well have been under-performing recently and many stocks from this sector witnessed a cut of 5-10 percent today. The only relative outperforming space today were the Pharma stocks. However, although a positive traction was witnessed in most of the stocks from this sector at the start of the day, but at the end the momentum shifted to only fewer names. Thus, it is advisable to stay light on positions and avoid aggressive bets ahead of the mid-week holiday and keep a watch on how the index behaves around the above mentioned levels."