A 100 point bounce from 5925 levels and a close above value high seem to have got people excited and talking about a bottom.
Bottoms are a process, never an event!
Well, we may go up again tomorrow and the peculiar ‘P’ shape observed in today’s profile was weird because it comes on a downtrend. We would have been happier seeing a ‘b’ today.
The chart above shows a strong seller at 6050-6055 region, who sold thrice at that point ( Notice the horizontal bar is 90 % red at 6050).
If this seller is overcome at the open tomorrow, then we will auction in the single print zone upto 6090 levels.Expect reaction to build up either here or at 6165 levels. This market will be sold into till these two levels are conquered.
Another reason for my unease about this move up today in the Nifty, was that the Bank Nifty closed well below the lows from tuesday. The Bank Nifty has led the Nifty for the past 1000 points and even today, it was the weakness in the banks which drove the Nifty lower early in the morning.
Readers would remember 12460 as the level which caused the gap-up after the ICICI results took the Bank Nifty up 400 points the previous day. 12460 was finally broken today ( after 3 attempts) on volumes and the 12460-12490 zone will be a difficult terrain to cross.
Any rally without the Bank nifty making highs would be suspect. I prefer to be a bear until then and wait out this move up.