Nifty update for 29th December 2011

Nifty gave a decent opening bell for buyers to square off their positions above 4750 and made lower lows during the session. As i said in the previous posts Nifty can't make a decisive move on the upside because of the lack of volume ,thus it just gave a negative bias to the market but did not do much damage.Though index traders had a normal range bound session but some of the biggies have broken down and poor advance/decline ratio is an evidence for that.Some of the major stocks like Reliance, SBI, Axis bank ICICI bank have already given a topping out pattern and Nifty has a major challenge of holding high in spite of these weaker names.One major pharma stock Dr.Reddy's had a good rally though out the past 3-4 months but is on the verge of a trend line break out on the downside. These are some major worries for the bulls and will have a serious effect on nifty traders once the volume traders are back in the system.As of now Nifty is holding our major support zone of 4640 but making lower tops in intra day charts which is a very weak signal.Once the trading volume is back to normal we could see a break out most probably on the downside.Thus i would not be a buyer on the next dip .We can see a reversal on the upside only above 4810-4840 zone and till then it is a wait for new lows.Volatility data shows that short positions got accumulated on every rise and 4810-4840 could be seen a reversal point on the upside.