Nifty likely to witness range of 2840-2735: Bhambwani

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Nifty likely to witness range of 2840-2735: Bhambwani

This article was posted on Feb 27, 2009 and is filed under Market Outlook

Technical Analyst, Vijay Bhambwani: The markets opened on a nervous note and ended with gains as the anticipated pre-expiry bear squeeze pushed indices higher. The benchmark indices gained under 1 % at close. The traded volumes were higher as the retail participation perked up. On an uptick session, that is a sign of optimism. The market breadth was negative as the BSE & NSE combined advance decline ratio was 1454 : 2047. The capitalisation of the breadth was positive as the BSE & NSE combined figures were Rs 6492 crs : Rs 5603 crs. The divergence indicates buying on heavy weights and selling on midcap stocks.

The indices have closed in the upper end of the intraday band as the bear covering kept the downsides capped. The higher traded volumes are a silver lining for the bulls and marginally negative internals indicate a continued lack of buying conviction at higher levels in the retail camp. The intraday range specified for Thursday at the 2800 / 2700 has held as the Nifty retraced from the 2798 levels.

The coming session will witness a range of 2840 on advances and 2735 on declines. The bullish trigger for the session will be at the 2775 and the bearish trigger will be constant at the 2750 levels. Being a weekend session, volumes assume significance as a measure of risk appetite.

The market internals indicate a higher turnover due to the bullishness. The number of trades were higher and the average ticket size per trade was higher, indicating an improved buying bias. The capitalisation of the market was higher in line with an uptick session.

The outlook for the markets today is that of guarded optimism. Should the overseas cues be positive, the bulls may attempt a comeback.

source: Moneycontrol

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