Nifty likely to witness range of 5750-5640: Bhambwani
The coming session is likely to witness a range of 5750 on advances. Support is likely at the 5640 below which the 5600 maybe tested. The bullish pivot for the session is likely at the 5715 levels and the bearish pivot at the 5690 levels.
January 20, 2011 / 08:21 IST
Technical Analyst, Vijay Bhambwani:
The markets opened on an optimistic note and ended the day with losses as the bulls failed to keep the Nifty above the 5710 bullish pivot throughout the session. The benchmark indices ended with approx 0.5 % losses at close. The traded volumes were higher compared to the previous session, which is a negative indicator for a bearish session. The market breadth was negative as the BSE & NSE combined advance decline ratio was 2095 : 2109. The capitalisation of the breadth was negative as the BSE & NSE combined figures were Rs 4302 Crs : Rs 12288 Crs. The NSE shed Rs 9457 Crs in market capitalisation.The indices have closed in the lower end of the intraday range as the bulls were unable to support the markets at higher levels. The intraday range advocated for the Nifty between the 5760 / 5680 was overcome as the Nifty tested the 5662 levels intraday - thereby marginally exceeding our intraday wave count employed on the downside. The coming session is likely to witness a range of 5750 on advances. Support is likely at the 5640 below which the 5600 maybe tested. The bullish pivot for the session is likely at the 5715 levels and the bearish pivot at the 5690 levels. Traders must watch these levels for signs of trend determination in the coming session.The daily candle chart of the Nifty shows a large bearish candle with a lower wick, indicating support on declines during the day. The bearish candle has pierced the previous day's bullish candle thereby making a "kabuse" pattern with short term negative implications. For the bulls to prevail over the bears, it is important that the Nifty remain above the 5715 levels consistently on Thursday.The market internals indicate a higher turnover due to the volatility. The number of trades were higher and the average ticket size per trade was higher, indicating a selling bias. The capitalisation of the market was lower in line with a bearish session. The put call ratios indicate the bears squaring up their Nifty positions on declines.The outlook for the markets today is that of caution as the bulls must hold the Nifty above the 5715 levels sustain ably to manage an upmove in the coming session.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!
