Pre market round-up                  Feb 08, 2012 08:15 hrs

Index	Open	High	Low	Close	Change
BSE Sensex	17,813.74	17,832.04	17,582.49	17,622.45	84.86
BSE - 200	2,180.16	2,183.74	2,150.77	2,156.34	14.10
Nifty - 50	5,412.95	5,413.35	5,322.95	5,335.15	26.50
Bank Nifty	10,368.50	10,429.70	10,260.15	10,324.60	55.35
NSE Midcap	7,434.25	7,471.25	7,334.90	7,355.15	78.80
NSE CNX IT	6,426.00	6,426.00	6,291.45	6,308.55	62.35
NSE breadth - Adv	551	Dec	947	Volumes	Rs 14,217 Crs
BSE breadth - Adv	1247	Dec	1630	Volumes	Rs 3,453 Crs

The markets opened with a gap up and ended the session with losses as the bulls failed to hold the Nifty above the 5370 bullish pivot throughout the session. The benchmark indices ended with approx 0.5 % losses at close. The traded volumes were lower than the previous session due to the weak sentiments. The market breadth was negative as the BSE & NSE combined advance decline ratio was 1798 : 2577. The capitalisation of the breadth was negative as the commensurate figures were Rs 5554 Crs : Rs 12012 Crs. The NSE shed Rs 41669 Crs in market capitalisation.

The indices have closed at the lower end of the intraday range as the bulls failed to provide support at higher levels. The intraday range advocated yesterday between the 5425 / 5300 held as the Nifty retraced from the 5413 levels - thereby accurately validating our intraday counts. The coming session is likely to witness resistance at the 5400 levels above which the 5475 maybe tested (a lower probability event as of now). Support is likely at the 5275 levels below which the 5255 levels maybe seen. The bullish pivot for the session is likely at the 5385 levels above which the Nifty must stay throughout the session. The bearish pivot is at the 5350 levels below which declines may occur. Traders must watch these levels for signs of trend determination in the coming session.

The daily candle chart of the Nifty shows a large bodied bearish candle, corresponding with an outside day formation as per western bar charts, coming at a significant high of the ongoing rally, it indicates the bulls are on the back foot. The 5400 level is the previous swing high and the closer the Nifty gets to that level, the higher the volatility, we advocated this view since 2 session, and we stick by that opinion. For Wednesday intraday, the bulls must keep the Nifty above the 5385 levels with higher volumes and open interest to regain their intraday domination over the bears. The Nifty sustaining below the 5350 levels may trigger a fresh bout of profit sales.

The market internals indicate a lower turnover due to the selling on rallies. The number of trades were lower and the average ticket size per trade was lower, which indicates decreased retail buying presence. The capitalisation of the market was lower in line with a bearish session. The put call ratios indicate the bears ramping up their Nifty shorts.

The outlook for the markets on Thursday is that of guarded optimism as the Nifty will have to trade above the 5385 levels sustainably to rally further.

Vijay L Bhambwani
(Ceo - BSPLindia.com)

The author is a Mumbai based investment consultant and invites feedback at vijay@BSPLindia.com or 93237-20291.

Mandatory disclosure - the analyst has no exposure to the scrip/s recommended above.

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