Tuesday was a momentous day for the Indian market with the bulls finally managing to cross the 16,000-mark and closing above it with a flourish after testing it almost five times in July. And as it happens many times, the foreign institutional investors (FIIs) have come to the party after sulking for last two weeks with big numbers in both cash and futures markets. Now, the obvious question is: what next?

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This market has exhibited a classical pattern. The market breaks out, then consolidates, takes a step back while the midcaps outperform and then the large-caps bounce back.

In the past whenever Nifty has broken out of a trading range, it has added 500 points in a fresh expansion, so it’s logical to now expect a move towards 16,500.

But what could lead it?

If yesterday was any indication, the Bank Nifty might be willing to finally put its hands up. It’s an index which has massively underperformed the Nifty during the last 1000-point run but yesterday closed above the 20- and 50-day moving average (DMA). The key today would be SBI’s numbers.

Another thing that could happen now is that large-caps could play some catch-up. This year, the Nifty is up 15 percent while the smallcap index is up 49 percent.

While one swallow doesn’t make a summer, yesterday, the smallcap index ended in the red. Could that be an indication of things to come in the near term? We will have to wait and see.