The recovery is to be seen as a natural outcome of the hysterical selling of the previous day. But technically speaking, what is happening is a resumption of the market's upward movement. I expect market participants to continue to take positions on Friday for gains on Monday. But that does not preclude some amount of week end profit- booking. The most likely scenario is that punters will take position again at lower levels. The bullish undercurrent is reflected in the market volumes.

The advance volume at BSE has gone up sharply from Rs 1373 crore to Rs 2367 crore, while the decline volume has been declined from Rs 3159 crore to Rs 318 crore. The number of advances have gone up from 750 to 994, and the number of declines have gone down from 1432 to 1175. An indication that punters expect the bullishness to pick up further momentum next week is reflected in the sharp rise in advance volume at NSE. The advance volume has shot up from Rs 1389 crore to Rs 3366 crore, while the decline volume has nose dived from Rs 2666 crore to Rs 288 crore.

The strengthening of HLL with volume is good news for market players. ITC has stabilised. Another indication for the market recovery process is Hindalco. Both power companies are bullish. The long-term indicators continue to signal holding on for medium term and long term investors. The short term may see some intra day gyration, but technically there is a good chance for the upward momentum to carry itself forward to the next week.