Avoid short sales for now: Bhambwani

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Technical Analyst, Vijay Bhambwani:

The markets staged a recovery after noon as the bulls found their feet and the indices vaulted 2 % higher. The market breadth was positive as the BSE & NSE combined advance decline ratio was 2292 : 1589. The capitalisation of the same on a commensurate basis was positive too at Rs 17088 Crs : Rs 4380 Crs. The f&o data indicates a lower turnover due to the high base effect of the roll over process yesterday.

The indices have closed at the upper end of the intraday range that too on expanded volumes and positive market breadth. These are bullish indicators and point towards an upthrust. The 4380 / 4250 range advocated for Friday was overcome on the upsides as the Nifty closed above this range.

The coming session is likely to witness a range of 4530 on advances and 4300 on declines. As long as the Nifty spot remains above the 4355 threshold, expect optimism.

The market internals indicate a higher turnover as the participation levels rose due to the bullish undertone. The number of trades increased and the average ticket size was lower, indicating a retail buying bias. The capitalisation of the market was higher in line with an uptick session.

The outlook for the markets toay is that of continued optimism, dependent on overseas cues remaining neutral to positive. Ignore short sales for now.

Disclosure: The analyst has no exposure to any scrip/s recommended above.