Comment

The markets witnessed a negative week as the bulls were conspicuous by their absence. The lack of buying support was evident as headline indices fell till the end of the trading sessions. The market breadth was negative by a wide margin as retail buying too was not forthcoming.

The Nifty 50 lost almost 3% on a week-on-week basis, even as the holiday-impacted week reported lower traded volumes.

Overseas investors pumped in Rs 2,279.30 crore during the week, which resulted in the rupee settling at the 46.51 levels. The Dow Jones Industrial Average settled marginally lower as the psychological threshold of 10,000 proved to be a pressure point for the bulls to overcome convincingly. The Nasdaq composite index was marginally better off. The UK market outperformed the US markets as the FTSE 100 gained a percent week-on-week.

This week may see some routine profit sales as the bulls get accustomed to the 10,000 levels on the Dow, but the overall trend remains positive. The rising tops and bottoms formation remains in force and the downsides will see support cushions.

Technically, the domestic markets are underperforming their overseas peers in the last few sessions, as the holiday season, with resultant lack of participation and profit sales, is eroding bullish sentiments.

The Nifty is likely to witness a weekly range of 5300 on advances, though that target seems ambitious for the bulls to achieve. Support on declines will be seen at the 4825 levels as the short covering ahead of F&O expiry may cushion the declines marginally.
The bullish pivot for the week will be at the 5100 level and the bearish pivot at the 5050 level, below which the bears may emerge with renewed vigour. Traded exposure should be curtailed till the upward momentum gains strength.