Year ends on positive note, as Nifty gains 24 per cent in 2021
The 50-stock Index went up from 13,981 to 17,355
image for illustrative purpose
The market closed with an optimistic note on year-end. During this year, The Nifty has gone up by 24.15 per cent, from 13,981 to 17,355. In the last one month, it advanced by 380.40 points or 2.24 per cent after witnessing higher volatility in recent times. On the last day of the year, the benchmark index gained by 150.1 points and settled at 17,354.05. All the sectoral indices closed in the green territory. Barring IT, all the sector indices are higher by over one per cent. The Metal and Auto indices went up by 1.94 per cent and 1.69 per cent, and are the top gainers. The remaining indices are up by 1 - 1.5 per cent. The Nifty IT advanced by just 0.11 per cent. The volatility index VIX was down by 2.07 per cent. The market breadth is positive as 1471 advances and 578 declines have been recorded. About 129 stocks hit a new 52-week high, and 205 stocks traded in the upper circuit. 123 bulk deals happened today.
Friday was the close of the yearly, half-yearly, quarterly, monthly and weekly closing too. The Nifty formed two consecutive lower high and lower low candles and a doji on a quarterly candle. A daily chart has broken out of slopping trendline resistance. The index retraced 80 per cent of the prior downswing. The 17,500-516 zone will act as a resistance where the trendline and 50 DMA are present. For the consecutive day, the index sustained above the 20DMA. After two consecutive Doji candles, the Nifty closed above the last three days of the sideways range is a positive for the market. The RSI move above the 50 zone indicates mild bullishness. The overall strength is positive as it closed above the prior swing high. MACD histogram shows an increased bullish momentum. But, the Stochastic oscillator shows an over brightness in the index. The other concern is that even though the index moved higher, the relative strength has not improved, compared to Nifty-500, which is declining. And the index is trading still below the anchored VWAP resistance. The Stochastic-RSI is also showing the overbought condition in the index. At the year-end, the index management has perfectly done to manage the NAVs. The next weekly candle will give us a fair idea about the future trend. Only a move above 17640, the reversal signals will be available.
(The author is financial journalist, technical analyst, and family fund manager)
