Nifty likely to witness range of 5065-4900: Bhambwani

Technical Analyst, Vijay Bhambwani:

The markets opened on a nervous note and ended the session with continued losses as the bulls failed to keep the Nifty above the 5065 threshold. The midcap and technology stocks were the under performers in the markets. The benchmark indices ended with almost 1.25 % losses. The traded volumes were lower which is a routine indicator for a bearish weekend session. The market breadth was negative as the BSE & NSE combined advance decline ratio was 944 : 3108. The capitalisation of the breadth was negative as the commensurate figures were Rs 3970 Crs : Rs 18446 Crs. The NSE shed Rs 68528 Crs in market capitalisation.

The indices have closed in the upper end of the intraday range as the bulls made their presence felt at the fag end of the session. The intraday range specified for the session between 5085 / 4900 was violated on the downsides as the Nifty tested the 4806 levels.

The coming session is likely to witness a range of 5065 on advances above which the 5130 maybe seen. Support maybe seen at the 4900 levels on declines, below which the 4700 maybe seen. The wide range is due to the high base effect of Friday. The bullish pivot for the session is likely at the 4930 levels and the bearish pivot at the 4880 levels. Traders need to watch the these parameters for signs of breakout / breakdown from the previous sessions range.

The market internals indicate a lower turnover due to the selling at higher levels. The number of trades were higher and the average ticket size per trade was lower, indicating a selling bias. The capitalisation of the market was lower in line with a downtick session. The f&o cues show the bears ramping up shorts on declines.

The outlook for the markets today is that of caution as the bulls need to hold the Nifty above the 4930 mark.

The columnist is the author of the book "A Traders Guide to Indian Commodity Markets" and invites feedback at vijay@BSPLindia.com or (022) 23438482.

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Disclosure: The analyst has no exposure to the scrips recommended above.