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Nov 08, 2011, 11.35 AM IST
On Friday, the Nifty failed to hold above 5,300 and the Sensex closed 80 points higher. Sudarshan Sukhani, Technical Trends says, the Nifty is in a trading range of 5,200-5,350. According to him, there will be a big upmove, if the Nifty breaks 5,350.
According to him, there will be a big upmove, if the Nifty breaks 5,350. Likewise, he says, if 5,200 breaks, the index will go down.
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Below is the edited transcript of his interview with Latha Venkatesh and Sonia Shenoy of CNBC-TV18. Also watch the accompanying videos.
Q: What is your call on the Nifty now?
A: I think the Nifty is in a trading range. The trading range is broadly between 5,200 and 5,350. It is narrowing down now. Today, we will open inside the range. It will be a small gap up, not much because we have to compare ourselves with Friday, not yesterday’s market moves. So, it will be a very mild gap up within the trading range. Therefore, it is almost impossible to suggest where we will go from there.
Traders must understand that the trading range is always a very good starting point for a big move. If we cross 5,350, we will get a big move on the upside. If 5,200 breaks, anybody’s guess, we will go down.
Q: You are negative on Andhra Bank. You have a ‘sell’ on that stock, right?
A: I am negative because PSU banks are doing something very unusual. Half the banks are doing very well and the other halves are doing very badly.
Andhra Bank has been a very disappointment on the charts. The stock is actually making lower lows while the market is steady. Nifty has gone up from 4,700 to 5,300. Andhra Bank is exactly where it was, infact it is falling down.
On Friday, the first pattern came in suggesting there is further downside. In the next few days, Andhra Bank should be trading lower. I have a target of Rs 112 for it.
Q: Infrastructure pack was doing quite well last week. You have a buy on IRB Infra today, right?
A: IRB is one of the better stocks in the infrastructure pack. It has gone through a deep correction. Sometimes that’s good news because it means that the correction is now over and we can look forward to better times.
It does appear that IRB is now making a small base and coming out of it. It was in a trading range between Rs 175 and roughly Rs 160. Now any move out of this range will be pretty decent.
I am assuming that we will see a breakout on the upside because the broad markets are fairly cheerful so far. Second, the pattern suggests that the trend is up. So, IRB is a buy.
It’s a buy for day traders who can look to buy, if they see any signs of strength. For swing traders, who are looking for more ambitious targets and wish too hold positions, can buy equities, and buy futures.
Disclosure: I have no personal holding in the stocks discussed.
Tags: Markets, Nifty, Sensex, NSE, BSE, IRB Infra, Voltas, Petronet LNG, Andhra Bank, Sudarshan Sukhani, Technical Trends
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