Reflecting this the Sensex opened with a whopping upside gap. It opened at 2956 against the previous close of 2884. As the bulls decided on a rally based on good sentiments, the Sensex leaped up by another 89 points to post an intra-day high of 3044. The low for the day was the opening level. A small reaction at close brought the Sensex down to 2984.

As everyone jumped on the bull wagon, the market breadth date profiles the extent of the surge. The number of scrips in advance at the BSE went up from 638 to 825, while those in decline went down from 613 to 362.

The volume in advance went up from Rs 742 crore to Rs 1146 crore. That in decline went down sharply from Rs 390 crore to Rs 168 crore.

At the National Stock Exchange the volume went up sharply from Rs 789 crore to Rs 1334 crore. That on decline went down from Rs 506 crore to Rs 157 crore.

On the daily Sensexchart the stochastic indicator has gone into the overbought zone. It is at 90.25, while the trigger line is at 64.40. Any value above 85 is considered overbought. On the weekly chart, stochastic indicator is at 41.84 indicating that the Sensex has much more room on the upside to aim for.

Based on the weekly chart technically the Sensex can reach up to 3266. But more interestingly, the question that arises now is about the reaction. And what would happen to the Sensex in the event of a reaction. This is the second time that the Sensex is rising with such gusto. The earlier rise happened starting on September 3. Starting at 2885 it went up very quickly to 3185.

Whenever there is a sharp rise, it is logical to expect a reaction. But ultimately if the bull grip is powerful, reaction could be subdued. But the interesting part of the current rise is that should the Sensex retract on a longer note, it could now take support at 2950.

In other words the current upsurge could continue for sometime.