Current upmove not to go above 4300 levels: K&A Sec

Sushil Kedia of K&A Securities believes that the current upmove will not go above the 4300 levels. He feels that the markets are deeply oversold as of now. It is safe to classify it as a strong pullback.

According to him, it is very late to sell in the markets.

Excerpts from CNBC-TV18's exclusive interview with Sushil Kedia:

Q: What do the technical suggests and how are you mapping the Nifty from here?

A: I would place not more than 95% chance that this current upmove, if it sustains, will not go above 4,300. I would not place more than 99% chance that this rally will fizzle out before 4,500. All of this is contingent upon within today or tomorrow Nifty not falling below 3,920-3,910 area again.

On one hand it is clear that even the discount was so deep, it was deeply oversold and as of now it is safe to classify this as a strong pullback. But when we look at a slightly longer-term picture of 15-20-30 days kind of patterns, very large number of stocks are close to potential reversal date or have made already potential reversal date yesterday. More than 60% stocks have had produced what I might term as a time wise reversal.

So in that sense if 3,900 also breaks, how lower am I looking at? Perhaps not lesser than 3,700. So 4,500 to 3,700 being the range and we perhaps will open around 3,950 area, I think it is very late to sell and over the next two days very nimble-footed, very close watching needs to be done for taking short-term long trends.

Q: A word on the IT charts because that’s one sector which is standing as an out performer in even bad days for the market. How are they looking?

A: As of now, along with all the large names and the midcap names as the trading reversal is coming in place, even IT is no exception. But I would guess that the bounce from hereon - IT does not look to be one which is going to propel that into a 52 week high. Looks more like on two-three-four months time frame, they have outperformed clearly. But in the next trading bounce, they may produce lower highs and perhaps in the fall after that they might fall far more. As of now that is the picture.