While these short term extremes do not rule out further losses it does indicate a level of capitulation in the near term and provides the platform for a snapback rally, Balanco says in his note
Mithil Pradhan of Violet Arc Global Managers is not so upbeat on the market recovery and believes there is further downside for the market in the short-term.
Our market fell quite a lot over the last two sessions. So, the hope is that even though it might be temporary, we will get a pullback now in the make because it looks quite oversold after the price performance in the last 48 hours, said CNBC-TV18's managing eidtor, Udayan Mukherjee.
The market did not have a good day and the closing was not great, below 5700, high volumes, poor breadth with the mid-caps and small-caps getting completely clobbered today. There is a probability that the market might be getting oversold.
There is stabilisation in the global markets, but whether this is a pullback or a temporary hiatus is still to be seen, says Udayan Mukherjee, Managing Editor, CNBC-TV18.
Stocks are at their most oversold levels since the doom days of the financial crisis and may be due for a rally, according to one measure.