Short oscillators bare bullishness

Technicals

 The breadth was highly positive though on lower volumes compared with the 10-day average volumes.

 The fact that the markets have surged on poor volumes is a cause for some concern.

 It spells a lack of selling pressure rather than fresh, strong inflows. The fact that the Nifty August futures are trading at a marginal discount to the cash price is another cautious indicator. The overall undercurrent remains positive, though.

 The Nifty has taken support at the 13-day SMA for the second time during a downward correction. That indicates a firm sentiment in the markets as the short term averages are historical supports in bullish markets.

 The short-term momentum oscillators have turned upwards before touching oversold levels, which is another indicator of bullishness.

 As advocated yesterday, the markets are unlikely to see major falls in the short term as long as the heavily weighted index stocks continue to trade above their 13 and 30-day SMAs.

 I expect 1167 levels on the Nifty as a firm support in the coming session and 1218 levels as the next resistance.

 The outlook for Friday