| The benchmark indices lost about a per cent as bulls failed to lend support at lower levels. Traded volumes were marginally higher than in Tuesday's session, which is a sign of concern. |
| The market breadth was negative as the ratio of advancing to declining shares on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) combined stood at 1252 : 1712. |
| The capitalisation of the breadth was also negative as the figures on the two bourses taken together stood at Rs 2,557 crore : Rs 4,685 crore. |
| The F&O positions indicate a build-up of short sales as the bears stack up shorts on the Nifty near-month futures. |
| The indices have fallen back into their upward sloping channels and the immediate supports on the downside are likely to be at 1781 and 5684 on the Nifty and Sensex, respectively, in the coming session. |
| The upsides are likely to be capped at 1816 and 5754 in an optimistic scenario. Traded volumes along with the market breadth need to be monitored for signs of trend determination in the near term. |
| The outlook for Thursday is of caution as bulls are likely to book profit wherever available if signs of nervousness persist. Bears are likely to add on to their short sales as their open trades get in-the-money. I would not advocate bottom fishing for short-term trades, whereas investors may resort to staggered averaging. |
| The most prudent strategy would be to initiate short combinations on the Nifty in the near-month series at deeply-out-of-money strike prices. |
| Among stocks, activity is likely to be in Bhel which has signalled a breakout. Should it maintain levels above Rs 612 for the session tomorrow, expect Rs 625 / Rs 630 levels in the short / medium term. Buy in small lots in the cash and F&O segments provided this condition is fulfilled. Vijay L. Bhambwani |
| Sebi disclosure: the analyst has no exposure to the scrips mentioned above. |
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