Do not go long before Nifty breaks 4240 levels: Rajat Bose

Q: How are you advising your Nifty traders to position the situation in the next 2-3 days? 

A: I would say that the next 2-3 days would be very crucial. The technical picture - there is going to be a rally this morning and you can see the Nifty might well test 4,215; the recent high. And once it is crossed there is a possibility that you may see a higher Nifty figure than 4,215 - that would trigger a lot of technical buys. But I would advice not to take any big long positions unless you see 4,240 is crossed and the Nifty sustains there. 

Today I would be watchful at these levels. If you go long that involves a lot of risk, so I would not be advising to go long whole hog. Until we cross 4,325, I would not say that this rally would be sustained, till such time it would only be a pull back rally and is not a major intermediate rally as such. 

Q: What’s happening with some of these banking stocks? There was quite a bit of a bounce coming in through last week between ICICI Bank and HDFC Bank, which ones is looking stronger? 

A: If you look at ICICI Bank, HDFC Bank,Axis Bank - three major private banks all of their charts are suggesting possible strong upsides today. For instance if you look at Axis Bank, it is likely to cross Rs 700 levels and move further. ICICI Bank is also suggesting that a lot of short positions were built in that and chances are that you might see Rs 640-650 kind of levels before some resistance comes in. HDFC Bank also corrected quite a bit and the Friday’s rally and the overall weekly charts suggest that even there, about 5-7% rally before any kind of resistance coming in.