Nifty likely to witness range of 5780-5700: Bhambwani
The coming session is likely to witness a range of 5780 on advances above which the 5800 maybe seen. Support is likely at the 5700. The bullish pivot for the session is likely at the 5735 levels and the bearish pivot at the 5720 levels.
January 25, 2011 / 08:15 IST
Technical Analyst, Vijay Bhambwani:
The markets opened on an optimistic note and ended the day with gains as the bulls managed to keep the Nifty above the 5690 bullish pivot throughout the session. The benchmark indices ended with approx 0.75 % gains at close. The traded volumes were steady compared to the previous session, which is a negative indicator for a bullish session. The market breadth was positive as the BSE & NSE combined advance decline ratio was 2476 : 1707. The capitalisation of the breadth was positive as the BSE & NSE combined figures were Rs 8669 Crs : Rs 5715 Crs. The NSE gained Rs 44008 Crs in market capitalisation. The indices have closed in the upper end of the intraday range as the bulls were able to support the markets at higher levels, aided by bear covering on declines due to the impeding expiry of the Jan f&o series. The intraday range advocated for the Nifty between the 5750 / 5650 held as the Nifty more or less kept within these levels intraday - thereby validating our intraday wave count employed. The coming session is likely to witness a range of 5780 on advances above which the 5800 maybe seen. Support is likely at the 5700. The bullish pivot for the session is likely at the 5735 levels and the bearish pivot at the 5720 levels. Traders must watch these levels for signs of trend determination in the coming session.The daily candle chart of the Nifty shows a larger bullish candle, indicating an upside breakout from an inside day formation. Follow up buying will still be a critical factor for the bulls to keep the Nifty bullish as the volumes on upthrust days has been below optimal levels. For the bulls to prevail over the bears, it is important that the Nifty remain above the 5735 levels consistently on Tuesday.The market internals indicate a tepid turnover due to the lack of big ticket buying on advances. The number of trades were lower and the average ticket size per trade was higher, indicating a lack of retail buying support. The capitalisation of the market was higher in line with a bullish session. The put call ratios indicate the bears ramping up their Nifty short positions on advances.The outlook for the markets today is that of cautious optimism as the bulls must hold the Nifty above the 5375 levels sustain ably to manage an upmove in the coming session. Due to a holiday on Wednesday, end of Tuesdays session may witness profit sales on longs.The analyst is a Mumbai based author of India's first commodity trading guide book - "A Traders Guide to Indian Commodity Markets" and invites feedback at vijay@BSPLindia.com.Disclosure: The analyst has no exposure to the scrips recommended above. Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
