Index trend and stocks in action on August 10, 2020
Nifty began the last week in deep water as it plunged over 1.5 per cent on the very first trading session of the week; however, the 200-DMA acted as a saviour and the bulls logged a smart recovery from its important long-term moving average.
Having said that, the bulls did not make any significant progress in the latter half of the week as it was stuck in a 200-point range and faced stiff resistance around 11,225-11,255 levels. For the week, Nifty gained 1.27 per cent.
In the last three trading sessions of the week, Nifty had formed indecisive bars and the index had formed an inside bar in the final trading session of the week as the price traded within high and low of the prior bar.
For the week, it had formed a bull body candle with a long lower shadow that clearly reflects the sentiment of D-Street, which is, buy on dips as the traders and investors lapped shares with both hands after Nifty corrected towards its 200-DMA.
Nifty is currently trading above its 20 and 200-DMA. It is trading nearly 1.61 per cent above the 20-DMA and 3.34 per cent above the 200-DMA. Nifty has been trading above the 200-DMA for the past 14 trading sessions but the 200-DMA is a flat trajectory.
For the coming week, Nifty is likely to be in the range of 10,850-11,380. The lower boundary support is defined by the critical 200-DMA and the upper boundary resistance is defined by the 78.6 per cent retracement level along with the trendline resistance, which is formed by adjoining the lows made in October 2018 and August 2019.
For the day, the high and low of the inside bar, which was formed on Friday, are critical for Monday as a break on either side could lead to a trending move.
Overall, the trend is in favour of the bulls but the fatigue is clearly visible in the price action of the last three sessions, which is giving us a sense that a corrective decline or time correction is possible in the near term.
Ganesha Ecosphere: The board of directors of the company has decided to acquire an under construction washing plant in Nepal.
Nandan Denim: Fire broke out at the spinning unit of the factory located at Piplaj, (Ahmedabad). The production in the spinning unit has been disrupted due to the incident. However, the loss due to fire is not yet estimated.
FDC Ltd: The board of directors approved buyback of its own equity shares from the shareholders of the company at a price of Rs 450 per equity share.
IndusInd Bank: The bank has, on August 7, 2020, pursuant to invocation of the pledge of shares, acquired: (i) 56,83,320 equity shares of Eveready Industries India Limited and (ii) 78,32,253 equity shares of Mcleod Russel India Limited.
Tube Investments of India: The board of directors of the company at the meeting approved the proposal for making a binding bid for acquiring a controlling interest in CG Power and Industrial Solutions Limited.