Market internals remain weak

TECHNICALS

The traded volumes were lower compared to the previous session, which is a minor mercy as markets are known to drift on poor volumes over time.

The market breadth was negative as the combined exchange advance decline ratio was 714:3163. The capitalisation of the breadth was also negative as the commensurate figures were Rs 1944 crore:Rs 12,862 crore.

The indices have closed at the lower end of the day's spectrum even as the market internals remained extremely weak. As was advocated over the weekend, the session was adversity-laden for the bulls. The 4000 / 4245 range advocated for Monday held as the benchmark index traded within this range.

The coming session is likely to witness a range of 3950 on declines and 4125 on advances. The Nifty spot will have to consistently trade above the 4115 levels if the bulls are to return in the fray. On the flip side, consistent trade below the 4075 levels will see a bearish outlook emerging.

The market internals indicate a lower turnover as the participation levels fell due to the decline. The number of trades decreased and the average ticket size was lower, indicating a marginal selling bias.

The outlook for the markets on Tuesday is that of abundant caution as the overseas cues will continue to impact domestic sentiments.

Vijay L. Bhambwani
(CEO- BSPLindia.com)

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/s recommended above.