| The markets opened on a shaky note and ended the day with sharp losses. The benchmarks gave up all of their Thursday's gains. |
| Traded volumes were marginally higher than in the previous session, which is a sign of concern as the falls have invariably been accompanied by higher volumes. |
| 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 1031 : 1345. |
| The capitalisation of the breadth was also negative as the figures on the two bourses taken together stood at Rs 1,110 crore (advances) : Rs 4,120 crore (declines). |
| Derivatives data available for the previous session show a marginal rise in open interest as the outstanding futures contracts have risen slightly. |
| The indices have returned to their channel bottom levels and are now very precariously poised. |
| Should the 1456 levels be violated on the Nifty, we can expect a fresh, rapid weakness to set in. This is the immediate floor that players need to watch out for in the near term. |
| The resistance on the upsides will be at 1520 levels, which is proving to be a formidable barrier in the absolute near term. Traded volumes will play a key role in near-term trend determination. |
| The outlook for Monday is of abundant caution as the impeding expiry of the derivatives May series will exert demand / supply pressures on sentiment. |
| Also, the bulls seem to be losing their initiative in the short term. The software sector is likely to hold out against the bearish sentiment and limit the downside for the near term. |
| The best strategy for now would be to initiate bear call spreads in the Nifty at conservative strike prices in minimal lots only.
Vijay L Bhambwani |
| Sebi disclosure: the analyst has no exposure to the scrips mentioned above. |
Back to the channel bottom
TECHNICALS
Don't miss the most important news and views of the day. Get them on our Telegram channel
First Published: Jun 19 2004 | 12:00 AM IST
