Nifty fell short of clearing the 50DMA, closed at 11222.4, down 5bps for the day. It cleared the key level intra-day and then got rejected. We noticed some distribution across few leading stocks as well.
The banks gave back almost half of the gains from yesterday:
Sector wise, Metals, IT and Auto outperformed today:
Outlook: I expect Nifty to stay volatile around this 50D level. So I think it’s a good time to add some short positions opportunistically.
Plenty of stocks were weak even during the recent Nifty bull run (April 2020 – Sep 2020). These particular stocks also got the momentum from the rally of Friday and Monday giving us a good spot to add some shorts. In case the market rolls over, these stocks will likely provide a better downside exposure. I highlighted one such opportunity today (link here).
All the best!
Charts sourced from investing.com
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.
Disclaimer: This is not investment advice, please do your research before committing capital. Stop loss levels mentioned are indicative for the risk I would be willing to commit on these trades with my trading style. Everyone’s different, commit what you can stomach losing.