On Tuesday, the Sensex dipped below its recent low of 2848 points. Even on Friday, it touched a low of 2741 points, just 28 points away from the December 1996 low of 2713 points.

The 64-points can be entirely blamed on HLL, which lost 7.09 per cent in three trading sessions. However, ITC offset some part of the loss as it gained more than 2 per cent. Stocks like Reliance and Bhel have also showed some gains. Had HLL remained unchanged, the Sensex could have shown some improvement over the previous week's close.

But the short-term perspective for the Sensex has improved and it is much better than what it was last Friday. ITC has put up an impressive show and is expected to retain it for next two-three days. If it crosses Rs 716, the stock can touch a high of Rs 748. Others like Reliance, State Bank of India, and Bhel may also show a smart spurt. Theshort-term oscillators for Reliance and SBI have given a position divergence. This divergence is nothing but a hint towards a short-term rally. Bhel also appears strong and is expected to participate in the rally.

Even in HLL, which has turned weak, a short-term rally cannot be ruled out. In the past, whenever the stock has shown a fall of more than 5 per cent in less than three trading sessions, it has been followed by a sharp rally.

Considering this, there are great chances that the stock may show some recovery before starting on a southward journey again. MTNL is the only pivotal, which appears weak. As most of the pivotals are positioned for a rally, the Sensex is expected to see a rally in the coming days. But whether the rally can be sustained is yet to be seen.

Besides pivotals, other specified stocks which are expected to rally are Arvind Mills, Castrol, Crompton Greaves, Dabur, EIH, Essel Packaging, Finolex, ICICI, IDBI, Indian Rayon, Nagarjuna Fertilisers, Tisco, and Telco. Long positions oncounters like IPCL, Ranbaxy and Raymond can bring attractive returns.