More stocks are going into a bull run in the cash group even as many stocks in the forward section are scaling new highs, the mini bull run will continue for some more time. However, the weekly momentum indicators for indices are already overbought and this means that we could soon see a correction, especially in the forward section, in the next few weeks.

Investors must bear this in mind before taking up any fresh long positions.

Today I will take a look at the paper sector which is sub-divided into two sub-groups -- major and medium/small paper firms. Select stocks in this sector have moved above theirearlier intermediate tops and this is a bullish sign. However, the current intermediate uptrend is quite mature, it is better for investors and traders to wait for the next intermediate term correction.

Balkrishna Industries

Balkrishna Industries recently moved above its earlier intermediate top of 35 and is in a confirmed major uptrend. The 30WMA, which is equivalent to the 200 DMA, has also started to move up. Volumes have been supporting the current rise and the stock is likely to exhibit higher levels. The relative strength line for the stock has turned positive for the first time since 1995 which is a bullish sign and any long positions picked up must be held on. More long positions in the stock can be picked up in the next intermediate downtrend when the stock pulls back towards its 30 WMA. The weekly momentum indicators for the stock are bullish and higher levels for the stock are expected.

Ballarpur Industries

Ballarpur Industries was one of the first stocks in the paper sectorto go into a major uptrend. As a stock in the forward section, it is usually the first to move up and stocks in the cash group usually follow after these stocks register substantial gains. The weekly momentum indicators for Ballarpur Industries has been well above its trigger line, suggesting higher levels in the stock in the next intermediate rise. The relative strength line for the stock is also above its zero line and the volume has been supporting the rise which are all bullish signs. More long positions in the stock can be added in the next intermediate rise and investors must allow the stock to pull back towards its 30 WMA.

ITC Bhadrachalam

ITC Bhadrachalam is also in the forward section and is also one of the first stocks to go into a major uptrend in this sector. The stock closed above its earlier intermediate top of 29.95 and has been surging ahead. The weekly momentum indicators have been moving upwards, suggesting higher values will be seen in the stock and that investors must hold on.The next intermediate decline will pull back the stock towards its 30 WMA. This will be a good time for investors to add more long positions in the stock.

As the activity in the forward section shifts to the cash section, more stocks in the cash section will see a major uptrend.

Pudumjee Pulp

Pudumjee Pulp is one such stock to go into a major uptrend recently. The relative strength line for the stock has also moved above the zero line and the volume has been supporting the current rise. The stock has been trading regularly and a pulls back towards the 30 WMA must be used by investors to create more long positions.

Investors must only pick up stocks from the cash section that trade regularly. Also look out for the average trading volume before the current spurt and unless the trading volume is quiet reasonable, investors must avoid the stock. Regularly trading stocks means that the stock could be liquidated whenever the investor wants to get out.

TN Newsprint

TN Newsprint has beentrading regularly and after bottoming out, the stock has gone into a fresh intermediate uptrend. The relative strength for the stock is above its zero line and investors must hold on to the long positions in the stock. More long positions can be added in the next intermediate decline when the stock pulls back towards its 30 WMA.

Volume in the cash section has picked up as investors have been looking at cash-group stocks which are quite reasonable in value. Likewise, the trading volume in West Coast Paper has also increased and the stock has been rising and is above its 30 WMA. The relative strength line for the stock has been staying above its zero line and the trading volume has been reasonable but low. Hence, investors taking up long positions in the stock must keep this in mind and pick up lower quantity in the next intermediate decline when the stock pulls back towards its 30 WMA.

Aurangabad Paper

Aurangabad Paper recently went into a major uptrend with the stock moving above its earlierintermediate top. However, as the stock is trading below its base value, investors must preferably stay away. Secondly, the stock has not been trading regularly and investors could get stuck at higher levels, and may not be able to liquidate the stock. Thus, even though the stock is in a major uptrend, investors must stay away. They must look at the quality first. Today I have taken a look at only those stocks in the paper sector which have been trading regularly.