D-Street Week Ahead: More pullback can be expected, says Milan Vaishnav

economictimes.indiatimes.com:

markets had an incredibly eventful week as they reacted to the exit polls and the actual general election results. All happened in the same week; the Nifty saw itself forming a fresh lifetime high and also came off close to 8% from its peak. A remarkable recovery also followed that led Nifty to a fresh closing high as well.
The trading range also remained extremely wide; the Nifty oscillated in a massive 2,057.25 points range before closing near its high. The volatility too swung violently. It surged over 40% at one point in time; by the end of the week, it came off by 31.38% to 16.88 as compared to its previous week’s close.

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Following such a kind of move, the headline index Nifty 50 finally settled with a net weekly gain of 759.45 points (+3.37%).


As we step into the next week, the markets may also show some more extension of the pullback. At the same time, at this juncture, the markets also look vulnerable to profit taking-led retracements from current or higher levels as well.
The more important concern is that of market breadth. The breadth of the broader market is not as strong as it should be; while the broader market index Nifty 500 is inching higher, the breadth is not seen keeping pace with the kind of strength that it should.
Furthermore, despite the kind