Don't see Nifty going below 5200-5220: Ambareesh Baliga

The Nifty lost 41 points to end its 5,300 run. It closed at 5,275. The Sensex dropped 129.14 points to close at 17391.98.

Ambareesh Baliga, COO, Way2Wealth says, the market would be in a consolidation range for sometime. "I don’t see the Nifty going below 5,200-5,220 levels. I think that will be a very good support. At the same time, on the higher side, I don’t see it crossing that 5,350-5,400 level. This is the broad range," he adds.

Meanwhile, Sudarshan Sukhani of s2analytics.com says, it is not a time to have long positions. “'At this point, we assume that market will correct after the big rally. That correction could take it to 5,200-5,150. It is better not to take long positions," he adds.

Also read: Ambit Cap keeps target of 18000-19000; sees no RBI rate cut

Below is the edited transcript of Ambareesh Baliga's interview on CNBC-TV18. Also watch the accompanying videos.

Q: What do you make of today’s pullback, just profit taking or something more than that?

A: It is surely profit taking. Last time, I had said that crossing the 5,350-5,400 levels is going to be quite difficult, unless you have some good dose of positive news. I don’t think that will come too soon. So, people are losing a bit of patience. At these levels, we are seeing profit booking because the next set of good news can happen only post July 19 as far as the policy action is concerned.

As far as monsoon is concerned, I think it will take atleast another two weeks to understand whether the monsoon has returned to normal or not. So, till then the market would be in a consolidation range where we will see some amount of profit booking like what we are seeing today.

Q: What kind of range do you have in mind? What is to your mind the maximum downside potential in this consolidation range?

A: I don’t see the Nifty going below 5,200-5,220 levels. I think that will be a very good support. At the same time, on the higher side, I don’t see it crossing that 5,350-5,400 level. This is the broad range.

Q: Many bankers are not expecting a rate cut to come about this time around. If it is a no action policy again, how do you see the market react? Do you think it will breach the 5,200 level that you are talking about?

A: If we have some policy action not from RBI, but from the government action between the July 19 and July 31, I think that will surely have a much positive reaction on the market as compared to no action by RBI on July 31. In case we have a policy action from the government, people will expect some rate cut happening going ahead.