Nifty is close to the mentioned target of 5900 and i am not expecting nifty to correct beyond 10th of Feb. The index is moving through a well tested channel and we are at the lower end of the channel at 5900. All the cash flow indicators are reaching the oversold territory but the momentum indicators are still in the sell zone. The gut feel says that nifty could eventually break the trend line and trap the bears below 5900. Thus any level close to 5900 can be an opportunity to cover the short positions and wait for an entry as a buyer. Though the correction can extend till monday don't wait till the final point to cover the short positions. Many of the large cap names have corrected a lot and it is better to limit the number of short positions. Some more downside many be left in stocks like YES bank, ICICI bank and LIC housing as these names have not completed their correction till now. Volatility index is showing more short build up close to 5990-6000 levels and we could see more addition in 5900 puts and 6000 calls. The tight range would be difficult to trade and we have not seen any huge build up in 5800 puts. Let nifty do some fighting within the range and no need to get into a trade as long as nifty is staying in the range. As per time cycles 8-10 Feb are dates for reversal and be cautious on your trades. If we compare momentum indicators Vs cash flow indicators i would prefer to go for cash flow indicators and they telling us to cover short positions on any sharp decline to 5900 levels
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