Increased intra day volaility is a sign of distribution, when this volatility comes at the top of a rally. Now, distribution does not get complete in a day or two. It is a process rather than a single event. W will probably see sharp upswings as well as selloffs while market participants remain confused on the next move by the market.
As I write ths post, the U.S. markets are up, after a sharp selloff in the previous day. The Indian markets are liekly to see similar roller coaster movements.For short term traders, the strategy should be to buy during periods of despair and despondency (use technical analysis to determine the actual buy points) and sell when the impression seems to be that the rally will go on forever.
The focus seems to be shifting back to midcaps and small caps. This is all for the good, since mid caps are aavilable at relatively lower valuations when compared to the large caps.