The markets extended the gains made in the previous session and that too on improved volumes. The bear squeeze seen on an empirical basis prior to the derivatives expiry was seen continuing in earnest. Traded volumes on the NSE logged a spike and the market breadth continued to remain negative as the combined exchange figures were 1852 : 2075.
The capitalisation of the breadth on a commensurate basis was positive as the figures were Rs 22,948 crore : Rs 3,401 crore. The derivatives data for the previous session indicated a slow build up of fresh longs and the PCR continued to rise.
The indices have closed at the upper end of the intraday range and that too on good volumes. The market breadth indicates a bias by the retail segment to book profits at higher levels, especially in the technology and small-cap scrips.
Going by the money flow indicators, the buying momentum seems to be originating from the stronger hands / institutional players.
The intraday range specified for Monday at the 4760 / 4910 was easily overcome on the upsides as the closing was convincingly above this threshold. The 4805 pivot proved to be short term bullish support above which the bulls prevailed over the bears.
The coming session is likely to witness a range of 4995 on the upsides and 4870 on declines. The bullish pivot for the day will be the 4905 level above which the Nifty spot will continue to remain positive.
The coming session is likely to be a positive one, subject to overseas cues and continued follow up buying at lower levels. Avoid the temptation to go short as the impeding expiry of the September series will see a continued bear squeeze.
