Avoid taking positions in Nifty today: Sukhani

He feels that one should wait for the Nifty cash index to take out 5,150 levels decisively and that could be a buying opportunity. "Till then it’s wise to wait for 100 point band to remain and be choppy," he added.

Below is the edited transcript of Sukhani’s interview with CNBC-TV18.

Q: How would you approach the Nifty given the global cues that we woken up to?

A: It is getting better. It is not going up and it’s not going down and sometimes it does it with violence and if this continues the traders will vanish from this earth. Yesterday’s market evidently justified a short position. It is true that the volume should have been low and the shorts were done at a level where the markets will open a few points higher than that.

But it’s quite possible that maybe yesterday was a reversal day. But the prudent action would be to close short positions and not take any positions in the Nifty. Let 5,150 on the Nifty cash index be taken out decisively and that will be a buying opportunity. Till then it’s wise to wait for 100 point band to remain and be choppy.

Q: Do you think Reliance Capital could be headed lower?

A: Reliance Capital made bearish head and shoulder pattern and then cracked. A lot of stocks declined on their own yesterday but the crack was there on support levels even before yesterday and the confirmation of a bearish pattern had come in. No matter what happens over this gap open there is a sense that at least for the time being high beta stocks are now out of favour.

Reliance Capital is a high beta stock, confirmed by a bearish pattern, so one will see follow-through on the downside. If there is a gap up then wait patiently and one can sell at a higher price.

Q: United Spirits numbers are expected to be weak today, but the chart also looks weak technically?

A: It does and it confounded me by rallying so much which was a surprise. It has been falling for five days; a small support level has already been broken and we have seen that a lot of stocks have reacted badly to their numbers. But the reaction of numbers in case of United Spirits I am assuming will be rather on the downside, which is what we are anticipating this and taking a short position.