Nifty may pullback to 4950, if 4770 holds: Anu Jain

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Nifty may pullback to 4950, if 4770 holds: Anu Jain

On Friday, the Nifty closed 50 points lower while the Sensex lost 160 points. Anu Jain, senior vice president of IIFL Private Wealth Management says, for any meaningful pullback, say till 4,950-4,960, the Nifty will have to hold the level of 4,770-4,780.

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Excerpts from Bazaar on CNBC-TV18 Watch the full show » ALSO READ See previous views by Anu Jain See what other Experts & Brokerages are saying about Idea Cellular See messages about Idea Cellular Idea Cellular BSE | NSE 29/05/12 Are Mutual Funds betting on Idea Cellular? Other Stocks in this news Shree Cements | Tata Steel | Hindalco Industries | Sesa Goa |

On Friday, the Nifty closed 50 points lower while the Sensex lost 160 points. Anu Jain, senior vice president of IIFL Private Wealth Management says, 4,770 to 4,780 is a resistance for the Nifty.

In an interview to CNBC-TV18, Jain says, for any meaningful pullback, say till 4,950-4,960, the Nifty will have to hold the level of 4,770-4,780.

She further says, if the Nifty gives up 4,700 then 4,550 will be more probable target.

However, she says, the bias is that the Nifty would hold 4,770 for the time being.

Also read: Sukhani sees 4700-5000 as trading range for week

Below is the edited transcript of her interview with Udayan Mukherjee and Mitali Mukherjee. Also watch the accompanying video.

Q: How are you approaching the Nifty? How much of a pullback would you give it?

A: If you see at the way the Nifty performed on Friday, it was within the trading range of the previous two days. We call it a 'doji'. It is generally a sign that there is steam running out of shorts atleast. For that to continue on the positive side you need the markets to close positive today. The good side is that we are opening positive today. If we can manage to hold on to that by end of trade then I think that would be positive.

On the upside, I would say essentially 4,770 to 4,780 is a resistance. For any meaningful pullback, say till 4,950-4,960, we would have to hold that level of 4,770-4,780 because that's when the shorts will get uncomfortable and probably will cover up.

If on the other side you were to give up 4,700 then 4,550 will be more probable target. But the way the chart patterns are looking the bias is more that 4,770 atleast for the time being would hold.

Q: Would you initiate long positions now from a short-term perspective on the Nifty or would you do it only after 4,770 gets taken out?

A: I think it's a good point to make an entry. Last week, the market did underperform, but some of the stocks have moved up. We have always had this attitude that when the markets are in a zone of total panic, it's more time to buy selective stocks, not everything. I would still buy the safe stocks because there where the trend is strong.

For a day trader, even buying the oversold counters say banking, metals could also prove to be a good bet on a day like this. But otherwise if you want to play it safe and want to take a trade for a week or two weeks where you want to hold the positions then it makes sense to hold on to this place where the charts have not got eroded.

Q: Are you bullish on Idea ?

A: I like the way it has moved up. I like the way the fact that it could hold on and pullback to Rs 96, close to its 20-day and 50-day moving average. I think if it were a bad day, I would keep a stop loss close to Rs 94. On a good day like this closer to Rs 95 my stop loss would be placed.

I think for a trading perspective it's moving close to Rs 100. If it can manage to hold on there then we look at higher targets of Rs 104. But for trading perspective for right now, I think a 4% kind of a move on the target is looking good.