Excerpts from CNBC-TV18's exclusive interview with Ashwani Gujral

Q: What’s your sense we have just paused for the last couple of days after clearing 5,100, do you think the markets break out today, technically speaking?

A: We are not in the frame of mind, where the market closes at the high of the day and next day you see follow through. As we saw on Friday there was a great close, yesterday the market sort of limped.

So we could turn range bound between 4,950-5,100 type of levels because it’s looking a bit over stretched in the short-term but after somewhat of a consolidation, one would see another up thrust and that probably would come from the under performers like the metals, banks, real estate type of stocks, more likely than the oil and gas, IT and other groups telecom etc, which have been leading it out.

Broadly I think for the moment it’s done the next rally will be about 5,280-5,400 may not happen as immediately as the short-term indicators seem to be overbought, so we need some consolidation here.  

Q: Two frontline stocks for you Bharti that’s moved almost 10% in the past three days and Siemens that almost touched its 52-week low yesterday?

A: Bharti has come out of its downtrend, infact both Bharti and RCOM. It’s now got support around Rs 840 and I think next target here should be Rs 950 and beyond that Rs 1,012.

Capital goods is one of the weakest sector and probably will remain so for the rest of this year and Rs 565 is the key level in Siemens, and if that gets consistently broken we could go as low as Rs 485 and it needs to get passed Rs 670-680, it is probably the weakest capital goods stock now. This is the sector that I would stay away from.  

Q: Two stocks that moved after a long time yesterday Bata and Titan?

A: Bata seems to have made some sort of a bottom as other midcap stocks have. It has got 200 EMA around Rs 184; support is now at around Rs 163, resistance at Rs 210 and about Rs 237. But people needs to be cautious that it’s unlikely that this stock will probably go back to its previous highs, people who have got at lower levels should think of booking profits at sometime.

Titan has been doing this range of Rs 900-1,200, if it can get past Rs 1,200-1,250 kind of band than it could probably get back upto Rs 1,480-1,500, but for that the market would need to break out of 5,100.

Q: How are the charts of some of the metal stocks looking Sterlite and SAIL?

A: They are quite sluggish although they are not declining as much now. Sterlite has support now at Rs 770 and could get back upto above Rs 990 to about Rs 1,000.

SAIL bounced back from Rs 165 and may be Rs 210-215 for that and inflation needs to come down and all these duties etc. There is too much of bad news and again what that probably does is that it provides these stocks with short positions, and in case inflation comes down they could bump off a lot higher and that’s our bet, that the under performers could give that huge bounce, once inflation comes into some sort of a control.

Disclosure:

It is safe to assume that my clients & I may have an interest in the stocks/sectors discussed.