Optimism running high on the Street

TECHNICALS

The markets opened on a bullish note and proceeded to extend the early gains through the day. The benchmark indices ended with over 1 per cent gains, thereby recouping the previous sessions losses. Traded volumes were improved over the previous session which imparts a qualitative strength to the upmove.

The market breadth was highly positive as the BSE and NSE combined figures were 2580 : 842 and the capitalisation of the breadth was also positive as the figures on a BSE & NSE combined basis were Rs 10608 cr : Rs 492 cr.

The F&O data for the previous session indicate a 2.5 per cent increase in net long positions which indicates a continued buying momentum from the bulls.

The indices have closed at the upper end of the intraday range and that too with increased volumes and positive market breadth. As I had advocated yesterday, the Nifty spot was outright bullish once the 3559 threshold was surpassed on the upsides.

The revival was led by the index frontline counters, which suggests buying by strong hands. The coming session will see intraday levels of 3601.36 on the upsides and 3528.44 on declines. Being a weekend session, upsides may witness minor profit sales and fresh build up of long positions may not be significant.

The outlook for the markets on Friday is that of continued optimism and barring any adverse news flow from overseas markets, the gains of Thursday should see a spill over of the optimism to Friday's trade. As long as the Nifty remains above the 3549 levels, bulls will continue to dominate the bears.

Vijay L. Bhambwani
(CEO- BSPLindia.com)

The author is a Mumbai based investment consultant and invites feedback at vijay@BSPLindia.com  or ( 022 ) 23438482 / 23400345.

SEBI disclosure: the analyst has no exposure to the scrips mentioned above.