A Trading Range Market ?

The Nifty fell by 150 points today, bringing it down to 4175. This is almost 400 points down from the rally highs recorded last week.
Below 4200, the intermediate trend is down, the short term trend is down while the primary trend has been down for a long time. It is likely that the Nifty may fall down to test the 3800 lows again. But when ? Before a decline occurs, we can easily see a see-saw market in which the Nifty falls and rises alternately. This means we can see a rally tomorrow, then maybe a follow through again on the next day, and then a sudden dip (after inflation numbers?).
This is the sign of a trading range market. The Index may have defined a low at 3800, while it may also have defined a high at 4550. Between these two limits, the Index could move up and down alternately, giving the impression of activity and trend, but essentially remaining in a trading range.
How do we trade such a market? By identifying extremes on the charts. When a rally is ‘over-bought’ consider selling while an ‘oversold’ condition deserves a buy.
The broad trend of the market remains down. Thus, a short position is likely to reward better, as compared to a long position.