Nifty around 5350: Is it time to buy?

213568 Investors following Reliance. Share this News with them.

0

Like this story, share it with millions of investors on M3

Nifty around 5350: Is it time to buy?

The Nifty continued to remain under pressure trading close to 5350—a key support level. All sectoral indices slipped were in red led by Reliance Industries.

Post your opinion here

 

0

Tweet

Share on Tumblr

Excerpts from Markets Midday on CNBC-TV18 Watch the full show » ALSO READ See previous views by Sudarshan Sukhani See what other Experts & Brokerages are saying about Reliance See messages about Reliance

The Nifty continued to remain under pressure trading close to 5350-a key support level. All sectoral indices were in red led by Reliance Industries .

Weak global cues were seen as the major contributors to this sedate performance. In the US, stocks fell sharply on fears about the economic recovery. Meanwhile, European markets opened in negative territory.

However, experts believe this current downtrend might be the much-awaited entry point for someone to enter the markets. Speaking to CNBC-TV18, technical analyst Sudarshan Sukhani said the markets are in some kind of corrective mode. "This is a long-term bull market and we are also very close to 5350, which has been significant support for two months almost. So immediately, as soon as the market stabilises at whatever level-below 5,350 or above it doesn't matter-the trade should be to buy that stability," he believed.

Technical analyst Ashwani Gujral reiterated 5,350 as an important intermediate low formed while during the market's upmove. "That is the key level that the market has just tested and probably we could have a couple of days of rally, which could lead this market upto 5,420-5,430."

He felt the first leg of the fall is done and now we might have a bit of a pullback. "In the US also, we are very close to 1,040-1,010 type of support level. So unless something very dramatic happens, chances are that these supports are likely to hold. Globally, we may have some kind of a pullback rally. So the Nifty is right now positioning for a pullback rally which could be 80-100 points," he said.

Reliance: To buy or not to buy?

According to Sukhani one should avoid risky bets at this point of time. "The stocks that have outperformed will outperform now also. We do not want to catch falling knives by trying to buy Reliance. That is not a good idea."

A safer bet, he said, would be oil marketing companies, banking or even autos, which had outperformed earlier. "These are the sectors that one should be looking at." However, he advised to steer clear of IT and metals.

Reliance could head towards Rs 950 believed Gujral. "A largecap stock, since it's at three-five months kind of lows, people who are looking for a longer horizon need to buy Reliance when sentiments down-when this kind of a stock is coming to bargain levels. So one should go in for spread out buying-Rs 920-860-at these sorts of levels and when the cycle turns for global commodities and Reliance you will be much better-off."