But what is more important to note is that shrewd and bold investors are using the opportunity to pick select scrips for long. Examples are Bharat Petro, Bharat Forge, Essar Steel, E.Merck, Grasim, HPCL, Glaxo and the like. In fact, the downtrend in the market has not stopped speculative buying interests. One example of this is Gujarat Gas, or Corporation Bank for another.

The number of advances at the BSE has come down from 817 to 616 with advance volume coming down from Rs 783 crore to Rs 528 crore.

The decline numbers went up from 1024 to 1245, with volume going up from Rs 960 crore to Rs 1081 crore. At NSE, the advance numbers came down sharply from 628 to 277 with volumeshrinking from Rs 1410 crore to Rs 568 crore. The number of declines expanded from 501 to 814, with volumes going up from Rs 846 crore to Rs 1421 crore.

The Sensex has now to test the 4518 level. This is the reference level for the index broke off from the high of 3 or more years around July 7. This is the projection of the 4327 of that date. A detailed check through several charts indicate that operators are giving up bull positions and letting them fall to their baseline. This appears to be the explanation, as the volumes are not ballooning as stock prices move down. It is difficult, therefore, to to say if there is short selling. Short selling could also be risky if you notice the high intra day volatility in select scrips, where traders have chosen to go long again.