Tech view: Distribution at higher levels

The market breadth was marginally positive as the combined exchange figures were 1997:1934. The capitalisation of the figures on a commensurate basis were negative as the numbers were Rs 10,424 crore:Rs 10,756 crore.

The indices have closed at the lower end of the intraday range and that too with unconvincing but positive market internals - indicating distribution at higher levels.

As advocated yesterday, the higher levels are encountering an unwinding bias and unless this process reverses, a sustained upthrust maybe elusive. The 5000 / 5100 range advocated for Wednesday held as the index gyrated within these thresholds.

The coming session is likely to witness a range of 5070 on advances and 4970 on declines. As long as the bears maintain Nifty levels below the 5035 mark, the outlook is likely to be negative.

The market internals indicate a lower turnover as the participation levels eased marginally. The number of trades decreased and the average ticket size was higher, indicating a bias towards unwinding. The capitalisation of the market was lower in line with a downtick session.

The outlook for the markets on Thursday is that of caution as the profit sales may continue on advances and the expiry process may witness choppiness.