Now is not an entry point but time to exit at 5100: Sukhani

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Now is not an entry point but time to exit at 5100: Sukhani

Sudarshan Sukhani of s2analytics.com spoke to CNBC-TV18 about his expectations of the market now. The Nifty yesterday crossed the 5000 with ease, but where is it likely to trend today? Check out his comments.

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

Sudarshan Sukhani of s2analytics.com spoke to CNBC-TV18 about his expectations of the market now. The Nifty yesterday crossed the 5000 with ease, but where is it likely to trend today? Check out his comments.

Q: What does the Nifty trader do past that or post that 5,000 mark?

A: Well, I am assuming that a lot of Nifty traders are long if they have been watching your show for the last one month. Once 4,600 was crossed, I think we went into a long position and that is maintained. For those who don't have a position, this is not the time now to enter. We are going to open higher and we are now reaching the 5,100 resistance. This is not to suggest that the markets are going to go down. But now technically, we have a significant resistance level where markets can become choppy and consolidate. So towards 5,100, traders should take profits, wait patiently for new buy signals or sell signals to come. But this is now the time to slowly exit.

Q: Would you be taking profits only on the Nifty or also in your stock specific positions that you might have been carrying along?

A: No, it's only the Nifty simply because we have 5,100 which is well identified, which should act as resistance, but it may not. The prudent trader could say okay, I have had a good run, which is what I am thinking too that this is a good time now. The trades were taken at 4,800. So it's been some kind of dream run. This is a good time to take money off the table. But individuals stocks are going to rally. It's amazing. They are now building bullish patterns on their charts and willing to breakout one by one. So there is no reason to exit individual stocks.

Q: Let's talk about Pantaloon which made a good move yesterday.

A: I never thought I am going to give a buy on Pantaloon but times have changed. Pantaloon is making something called a cup and handle pattern which is a bullish pattern. It's also a pattern that suggests a reversal from an ongoing bear market. Maybe it's doing that. So Pantaloon is now a buy. Yesterday it pushed against that cup and handle pattern and broke out. There should be significant momentum on the upside now. It's a buy for position traders also.

Q: What about PFC that was another strong stock yesterday?

A: It was and it's a buying opportunity. It broke out yesterday in a very large range. Prices moved up significantly. That tells us there will be follow through and probably an attempt to reach Rs 180. But I will just make a differentiation between Pantaloon which built a base and then broke out and PFC which made a 'V' reversal. V-reversal stocks cannot sustain. They have to go through deep correction. So PFC is a short-term buying opportunity. I don't think we can take a position trade here.

Q: On Sterlite , what kind of indications do you see now?

A: Sterlite built a base and it's not stopping; it's keeping on going up. At Rs 112, it crossed the previous high. It's akin to the Nifty crossing 5,100. Sterlite has already done that. That tells us that there is more upside here. In case of stocks like Sterlite which have simply had a one-way move up everyday, it's important to keep a stop loss and ideally you want to enter into an intraday consolidation or an intraday dip. But the stock is moving up and I don't see it stopping now. It's probably going to head towards that Rs 136 level eventually.

Q: VIP is back on your buy list?

A: It's back. I did comment on the markets that all these concept stocks are suddenly becoming buying opportunities. Since we look only at charts, the charts are supportive, that's the end of it. VIP again made a bottom of some kind for almost two months and has come out of that. Yesterday, it gained momentum. I think a move to Rs 120-125 is quite possible. VIP also has fallen, so the rebound could be as dramatic as the decline.