Market looks weak

The market had a gap-down opening, as expected, following weak US cues. The decline was the second largest in a single session as buying was conspicuous by it’s absence. The traded volumes were marginally lower than the previous session as the retail segment sat on the fence and day traders led the turnover.

The market breadth was negative as the combined exchange figures were 488:3451. The capitalisation of breadth was also negative as the commensurate figures were Rs 1555 crore:Rs 22,225 crore. The indices have closed at the lower end of the intraday range and with absolutely weak market internals.

That the turnover was lower cannot be deemed as a positive sign as the declines can prolong on thinner volumes. The 5220 bullish pivot necessary for the markets to remain firm was not even tested as the bears were in command from the opening bell.

The coming session is likely to witness a range of 5130 on advances and 4775 on declines. As per advanced elliot studies. the phase of declines has kicked off again and the bulls are likely to be at a disadvantage, barring some short covering.

The outlook for the markets on Tuesday is that of abundant caution as the bulls lack the buying conviction and advances are likely to encounter overhead supply from trapped short term longs. Avoid bargain hunting.

Via Business Standard