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Sep 11, 2012, 10.57 AM IST
Technical analyst Sudarshan Sukhani of S2analystics.com told CNBC-TV18 that the Nifty has entered into a trading range again.
It was a flat session for Indian markets on Monday. Sensex gained 17.13 points to close at 17,766.78 and Nifty rose 4.75 points to 5,363.45. Technical analyst Sudarshan Sukhani of S2analystics.com told CNBC-TV18 that the Nifty has entered into a trading range again.
He expects the Nifty to start the day on a lower note. One should not take long positions unless intraday momentum is on the upside, he suggests. "I would exit long positions if Nifty closes below 5,280 or gives the impression that it is going to do that," he added.
Below is the edited transcript of Sukhani’s interview with CNBC-TV18.
Q: It was a flat session for us yesterday, but we have seen a sell-off in global markets. How would you position yourself for trade this morning?
A: We have entered a trading range again. That’s normal for the market because the market goes and makes a big move and the Nifty has this tendency to then go into a hurdle and frustrating everyone, we can't help it. We can't do anything about it.
We just grin and bear it and expect the Nifty to make a move not necessarily today but certainly by 14th or 15th September. So, the trading bias is on the long side, but as the SGX suggests the markets are going to open lower. No long positions should be taken until and unless we see intraday momentum move on the upside. That may or may not happen today.
What we do now is we define a trading range which is about 5,280 to 5,400. We haven’t touched 5,400 but it is broadly the contour of the range. Inside this range trading is going to be difficult to do. We are keeping our long positions, but that’s about it, there is not very high conviction with the long positions because the market needs to cross 5,400 for us to be told okay the market has much more upside.
Q: I would assume therefore you mean that you will start worrying about your long positions only if the market were to go below 5280?
A: That’s absolutely right. I worry about them even now because if the market keeps on sliding, it is not a happy position to be in, but I would exit the long positions if the Nifty closes below 5,280 or gives the impression that it is going to do that.
Q: You are still positive on Bharti though it has meandered a lot around that Rs 260-270 range?
A: Bharti is making a trading range and a fairly decent bullish pattern, a small head and shoulder, but still it is bullish. If this is so, Bharti is just beginning a move that could take it all the way to Rs 285-290 - that’s good news. We always like these small patterns, they usually work out.
Q: The bad news has come in for Sesa Goa this morning as the Goa government has ordered a temporary suspension of all mining activities. You have a sell call on the charts as well?
A: Yes, the reason is that Sesa Goa rallied for just a day. We had reasonably decent move and we said this is it. But, I have always pointed out this is not it, one-two days of rally is immaterial. Sesa Goa is in a downtrend, that downtrend persists and it is probably one of the easier stocks to go and sell today.
Q: You have a sell on United Spirits ?
A: United Spirits - three days ago fell 40-50 points from Rs 980 to Rs 930 and is now making narrow ranges. So, it does give the first sense that the stock is now willing to go below Rs 930 and probably move into the Rs 800’s. It is not necessarily a change of trend, but, it is certainly a short selling opportunity for intraday traders.
Disclosure: I have no personal holdings in the stocks discussed.
Tags: CNBC-TV18, Nifty, Sensex, Sudarshan Sukhani, Bharti, Sesa Goa, United Spirits, Hero MotoCorp, Reliance Power, Century Textiles, BHEL, Hindalco, Tata Steel, Sesa Goa, SAIL, IRB Infra
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