The markets turned on a dime in the latter part of the session as high volatility and volumes indicated an attempted bottom formation in the near term.
The market breadth was negative as the Bombay Stock Exchange and the National Stock Exchange combined breadth was 961:2901. The capitalisation of the breadth was positive on a commensurate basis as the figures were Rs 12666 crore: Rs 10391 crore.
The markets have closed at the upper end of the intra-day range on heavy volumes — a positive indicator. The 4095/3885 range advocated for Thursday was violated as the Nifty spot breached the support.
The coming session is likely to witness a range of 4200 on advances and 3920 on declines. A consistent trade above the 4050 will see the bulls attempting to wrest the initiative from the bears. Volumes will play a crucial part in the trend determination process in the coming days.
The market internals indicate a higher turnover as the participation levels spiked up due to the volatility. The number of trades increased and the average ticket size was higher, indicating a strong buying bias. Avoid short-sales for now. Should the traded price of the current month futures stay consistently above the 30 minute average trade prices, the session will belong to the bulls.
Vijay L. Bhambwani
(CEO – BSPLindia.com)
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The author is a Mumbai-based investment consultant and invites feedback at vijay@BSPLindia.com
Mandatory disclosure: the analyst has no exposure to any scrip recommended above.
