O.E. & Market Breadth Key.

The markets opened on a firm note and proceeded to trade higher through the day. The benchmark indices gained over 0.5 per cent as the bulls managed to prevail over the bears for the third session in a row.

Traded volumes were marginally lower than the previous session as higher levels witnessed caution. Market breadth was highly positive as the BSE and NSE combined figures were 2395 : 1267 and the capitalisation of the breadth was also positive as the figures on a BSE & NSE combined basis were Rs 10,556 cr : Rs 2,683 cr.

The indices have closed at the median level of the trading session as the bulls have shown a tendency to book profits at higher levels. The 4123 level advocated as a resistance for Monday was not tested as upsides encountered overhead supply.

The lower traded volumes are indicating a lack of buying conviction at higher levels and unless the indices surge with high volumes, the retail segment is unlikely to participate in the buying process.

The coming session is likely to witness intraday levels of 4111 on advances and 4044 on declines. Watch the open interest and market breadth as the commitment of traders will be apparent from these parameters in the near term.

The outlook for the markets on Tuesday is that of cautious optimism as the upsides are likely to witness some profit sales. Fresh buying, if any, must be initiated on lower exposure only.