Bulls unlikely to come back in force in near term

Technical Analyst and CEO of BSPLindia.com, Vijay L Bhambwani: The markets opened on the back foot, as persistent worries on higher energy costs and resultant inflationary concerns chased the bulls away. The market breadth was negative as the BSE & NSE combined figures were 911 : 3022. The capitalisation of the breadth on a commensurate basis was also negative as the figures were Rs 3275 Crs : Rs 17118 Crs. The turnover was higher as the selling pressure accelerated. The f&o figures for the session indicated a higher turnover as the bears emerged with daggers drawn.

The indices have closed at the lower end of the intraday range as the selling pressure accelerated. The higher turnover indicated a selling bias even at lower levels. The intraday range advocated for Friday at the 5030 / 5130 was violated on the downside by a huge margin. The coming session is likely to witness a range of 5030 on advances and 4900 on declines. The 5015 will be a bearish pivot for Monday below which the players may expect continued selling pressure.

The market internals indicate a higher turnover as the participation levels rose. The number of trades increased and the average ticket size was higher, indicating a selling bias by retail hands. The capitalisation of the market was lower in line with a downtick session.

The outlook for the markets today is guarded as the bulls are unlikely to come back in force in the absolute near term.

Mandatory disclosure - the analyst has no exposure to any scrip/s recommended above.