Retail investors and traders pushing indices so high has confused the smart money and they have taken a partial short position but they are hesitant given the fact that nifty did not take a nose dive after a gap down opening. There is some weakness due to their partial move which did not let nifty to cover the gap. 16350 would be a very crucial level to watch out for. 16400 is having loads of activity as suggested by option data. But it would be hard for nifty to cross 16500 before 26 AUG expiry.
Daeron Trading is expecting sideways movement to continue and 16400 straddle in options would be a good strategy till this expiry.