Nifty update for 14th December 2011

Nifty took support at 4730 levels and bounced back to 4800 + levels. As said in yesterday's post it was not a volume selling day and a bounce was quite natural.It held our range of 4700 and seems to be getting filled.Turnover data shows that investors are not picking stocks at lower levels and the major cause of the rally was only short covering.Volatility has decreased substantially and Dollar/ Re cooled off in the second half of the trade. It was an intra day bounce and maximum could be extended to 4900 levels.As a trader i would be on the short side again if nifty breaks 4730 (today's low)or at the top around 4900 levels(if it forms a topping out pattern).In a major down trend like this i would not like to play the counter trend move on the upside and would like to sell on every rise.If it breaks today's low it does not seem to hold 4640 on the down side as it is a down ward channel.If it is a consolidation pattern at these levels it would benefit the bulls but it does not seem to happen in the near future. Let 4700-4900 remain as the broader range.