The markets opened on a weak note and ended with widespread losses as the selling pressure kept up till the fag end of the session. The benchmark indices lost 3 per cent at close.
The traded volumes were insipid as compared to the previous session, which is a routine indicator on a downtick session. The market breadth was negative as the Bombay Stock Exchange advance decline ratio was 1:2. The capitalisation of the breadth was negative as the sellers out weighed the buyers.
The indices have closed in the lower end of the intraday range and on negative market internals. The poor traded volumes are at best a minor consolation as markets are known to decline on poor volumes in bear phases.
The 2660 support specified for Monday has held as the Nifty bounced from this level, validating our wave count. The coming session is likely to witness a range of 2740 on advances and 2600 on declines. Should the Nifty trade consistently below the 2650 levels on higher volumes, the bulls may come under severe strain from fresh bear hammering.
The outlook for markets on Tuesday is that of caution as the bulls are at a severe disadvantage and only concerted heavy duty buying can reverse the trend in the near term. Unless overseas cues turn extremely positive, lay off fresh longs.
Vijay L Bhambwani
(Ceo - BSPLindia.com)
The author is a Mumbai-based investment consultant and invites feedback at vijay@BSPLindia.com
