Will rally be sold?

Today is a bit of a D-day for the market because there is a good chance that the market will have a big gap-up opening. The SGX Nifty is indicating a 50-60 point gap-up opening and it is fairly likely given that yesterday the US market was up quite a bit, the BRICS markets were up quite a bit, this morning Asian markets are up and crude bounced about 4 percent from the low.

There is a good chance that the market has a bounce back but then that will test the trend of the market. If the trend of the market is sell on rally, in that case the bears would get an absolutely right opportunity to go out and short the market because there is a good chance that the Nifty goes towards the resistance of 8,100-8,200. If this zone is used to short, the trend for the market would be firmly decisively decided.

If however, 8,100-8,200 is not taken as a major resistance when the market moves on, the bulls would have some hope but this market is still slightly inherently weak, make no mistake about that and it is dancing to global cues. So in times like these, you don’t know what would happen to global markets overnight and then you will react accordingly.

So, the issue there is that this market was stabilised on two accounts, one is that when global market stabilises and one when you start to see some foreign institutional investment (FII) inflows.