Tech View: Bulls make a strong comeback

The markets opened with mild optimism on falling crude prices and ended with stellar gains as the bulls returned with force. The traded volumes were higher than the previous session, a positive indicator on an uptick session.
 
The market breadth was positive as the combined exchange advance decline ratio stood at 2619:1307. The capitalisation was also positive as the combined exchange figures were Rs 18,533 crore:Rs 4,446 crore.

The indices have closed at the upper end of the intraday range - after a brief hiatus - as the session was a bullish one. The market internals point towards an optimistic undertone that seems to indicate further headroom northwards.

The intraday range specified for Tuesday at the 4315 / 4485 was overcome on the upside. A bear squeeze may follow if the upthrust extends. The coming session is likely to witness a range of 4605 on advances and 4425 on declines. The bullish pivot for the session will be 4465.

The market internals indicate a higher turnover as the participation levels rose due to the bullish undertone. The number of trades increased and the average ticket size was higher, indicating a stronger buying bias. The outlook for the markets on Wednesday is that of continued optimism, provided overseas cues are neutral to positive. Avoid the temptation to go short for now.