Good volumes a positive sign

The markets opened on a cautious note and ended the session with strong gains as the RBI announcement was greeted well by the market players. The erstwhile unwinding bias at higher levels reversed for a change as buying support emerged in force.

The traded volumes were sharply higher and coming on an uptick session, are harbingers of hope. The market breadth was positive as the combined exchange figures were 2324:1588.

The capitalisation of the figures on a commensurate basis was positive as the numbers were Rs 20362 crore:Rs 4499 crore.

The indices have closed at the upper end of the intraday range and that too with positive market internals - indicating the possibility of cheerful times ahead in the absolute short term.

The 5045/5135 range advocated for Tuesday was easily overcome as the Nifty closed significantly higher than this threshold. The coming session is likely to witness a range of 5115 on declines and 5275 on advances. As long as the Nifty remains above the 5150 mark, the outlook is bullish.

The market internals indicate a higher turnover as the participation levels rose sharply. The number of trades increased and the average ticket size was higher, indicating a buying bias by stronger hands.

The outlook for the markets on Wednesday is that of continued optimism as long as the overseas cues are positive.

via Business Standard