| The benchmark indices ended with over 0.5 per cent losses as the bulls were in no mood to support values at lower levels. Traded volumes were lower than the previous session as retail participation was poor. |
| Market breadth was highly negative as the BSE and NSE combined figures were 797 : 2629 and the capitalisation of the breadth was also negative as the figures on a BSE and NSE combined basis were Rs 3756 crore : Rs 9416 crore. |
| The derivatives data for the previous session indicated a mild fresh buying bias and the bears seemed to be pressing fresh shorts on advances. The indices have closed at the lower end of the intraday range, on negative breadth numbers and made a "swing reversal top formation" for short term players. |
| Coming so close to an "outside day" formation and near the significant high of the current upmove, the formation assumes significance. The 3854 support advocated yesterday has been conclusively violated and the top at 3900 was not even tested. |
| The intraday ranges are on the decline, which is likely to favour intraday short sellers in the absolute near term only. |
| As advocated yesterday, savvy and high risk players were forewarned of a fall and would have participated in the decline. The Nifty spot 3840 level is an important level to watch out for. |
| A sustained trade below this threshold is likely to witness selling pressure in the short term. The coming session is likely to witness intraday levels of 3818 on declines and 3888 in case of advances. |
| The outlook for the markets on Monday is that of abundant caution as the markets are appearing top heavy and distribution can occur in the near term. The magnitude of the derivatives long positions makes the scenario that much more cautious. Refrain from bottom fishing in the immediate future, unless buying for the long term. Vijay L. Bhambwani |
| Mandatory disclosure: the analyst has no exposure to the scrips mentioned above. |
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