Undercurrent bares weakness
TECHNICALS
| The market breadth showed indecisiveness as the ratio of advancing to declining shares on the Bombay Stock Exchange and the National Stock Exchange combined were 1588 : 1577. |
| Futures & options data from Wednesday's session bare a healthy 2 per cent rise in open interest, which points towards a higher risk appetite among the bulls. |
| The indices have managed to close below their short-term critical supports at 2064 and 6584 on the Nifty and Sensex, respectively. This points towards a weak undercurrent and a further slide in the coming session is not ruled out. |
| Downside support exists at 2048 and 6524 levels on the Nifty and the Sensex, respectively, in the coming session. |
| Resistance on the upside will be seen at 2074 and 6594 levels on an intra-day basis in Friday's session. |
| Keep a tab on traded volumes, open interest and market breadth for signs of trend determination in the absolute near term. |
| The outlook for Friday is of abundant caution as the bulls are unable to pull up the markets above the previous highs and are lacking conviction. Being a weekend session, we do not expect significant fresh buying support. |
| Among stocks, activity is likely to be seen in Bhel, which is showing signs of regaining lost ground on the charts. |
| Buying is recommended in the cash and derivatives segments with a 2 per cent stop-loss. Expect to see 3-4 per cent upsides in a bullish market in the near to medium term. |
| Traded volumes need to be curtailed in view of the higher volatility. Vijay L. Bhambwani |
| Sebi disclosure:- the analyst has no exposure to the scrips mentioned above. |