Nifty likely to witness range of 5150-5000: Bhambwani

Technical Analyst, Vijay Bhambwani:

The markets opened on a cautious note and ended the session with gains as the bulls managed to keep the Nifty above the 5010 bullish pivot in the latter part of the session. The benchmark indices ended with approx 0.9 % gains at close. The traded volumes were higher than the previous session which is a positive  indicator for a bullish session. The market breadth was positive as the BSE & NSE combined advance decline ratio was 2527 : 1731. The capitalisation of the breadth was positive as the commensurate figures were Rs 11102 Crs : Rs 4853 Crs. The NSE gained Rs 29883 Crs in market capitalisation.

The indices have closed at the upper end of the intraday range as the bulls were able to offer support at lower levels during the session. The intraday range specified for the Nifty between the 5060 / 4915 was overcome marginally as the Nifty tested the 5073 levels, thereby exceeding our intraday counts on the upside.

The coming session is likely to witness resistance at the 5150 levels on advances. Support is likely at the 5000 levels. The bullish pivot for the session is likely at the 5025 levels above which the Nifty must stay throughout the session. The bearish pivot is at the 4990 levels below which declines may occur. Traders must watch these levels for signs of trend determination in the coming session.

The daily candle chart of the Nifty shows a larger bodied bullish candle corresponding with a bullish outside day formation on the western bar charts with positive implications, indicating the bulls overcoming the bears at lower levels. Staying above the 5025 level with higher volumes and open interest will see the bulls retaining their intraday domination over the bears. The Nifty sustaining below the 4990 levels may trigger a fresh bout of declines.

The market internals indicate a higher turnover due to the strength. The number of trades were higher and the average ticket size per trade was higher, which indicates retail buying enthusiasm. The capitalisation of the market was higher in line with a bullish session. The put call ratios indicate the bears squaring up their shorts on declines.

The outlook for the markets on Wednesday is that of optimism as the bulls will have to keep the Nifty above the 5025 levels sustain ably, which maybe an achievable task. Marginal profit sales maybe seen on upthrusts.

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.

Mandatory disclosure - the analyst has no exposure to the scrips recommended above.