Hi Nimish, I am taking a contrary view. Most of the people around me are bearish. However, I feel we are at the bottom of the next bullish move(Which will take NIFTY above 5300). You might recollect that today's movement was similar to that when there was "bad news" about Dubai World's loan defaults. Both these day's were Friday's and we were on almost the top before starting these moves. On both days. the market opened with a gap-down.
As I have pointed out before, many stock have pushed through their trading ranges and there is little evidence of selling - this confirms that market players have taken a bullish view. They are now just trying to trap shorts, trigger stops, etc - in one word "Manipulation". If this was any serious correction, mid-caps and small caps would have crashed and had lower-circuits as if there will be no trading from tomorrow.
But the truth is that we make money based on price, and not on price-and-volume. If we take a short position in a genuine weak market, we can hope for profit. But if we take short position in a manipulated market, we never know when the market would go back to its real strength and lock us into a poor position. This has happened with me.
Check for yourself the volumes in other stocks. Many stocks have given nice low-volume tests or shake-outs. You will see high-volume in some charts, but you will notice that those stocks are near well-established supportive trend-lines, including the widely tracked NIFTY.
As I write this, the US market is still in red.
