What a setting for new week to start with nifty closing at record high for 2009 at 4732.Just contrast this to gloom prevailing in previous week when nifty was hanging on to last support of 4350.All this points to short covering being the main trigger for market rise and not any major fundamental change.
As i see it,most good news regarding fundamentals is priced in nifty beyond 4700 but since markets always have a tendency to surprise,we may see some more significant gains in next 2-3 days to take nifty beyond 4850, specially if dow holds and when all will be convinced that they got it right, markets will start to correct as fundamentals cant be ignored for long.
For traders,my advise would be to trade long keping a SL of 4650 while short term investors should keep on booking profits wherever they can while resisting the temptation to re-enter at these levels and as for long term investors(min 1-2 year perspective)should not try to trade markets and avoid looking at screen as all scrips i have suggested are good for long term holding also,its just that when a share has appreciated 300-400% in last 4-5 months,then a 20-25% correction in it is a minor thing.
One more thing,buying puts of nifty 4500 and 4600 wont be bad idea,if and when nifty crosses 4850.