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Sudarshan Sukhani's top five picks for today's trade

Published on Wed, Nov 25, 2009 at 09:33 | Source : CNBC-TV18

Updated at Wed, Nov 25, 2009 at 15:37

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Nifty

BSE | NSE 29/05/12

Are Mutual Funds betting on Nifty?

On Andhra Bank:

Andhra Bank and the rest of the banks have been going through a process of consolidation, small dips for the last two days and in that short-term cycle now they have all reached a turf. So the next move has been on the upside. Hence, it's not just Andhra Bank, most of the public sector undertaking (PSU) banks are buying opportunities for day traders, for two-three day swing traders. So buy Andhra Bank, keep a tight stop because if it doesn't work, it doesn't work. Rs 115 is a stop and a day trading target of Rs 121. I think the entire banking PSU space is giving some short-term buying opportunities.

On GE Shipping:

Shipping is coming out of a very long base building process. So it's not just for today; shipping seems to be promising better time and I do not know if it's because of the Baltic Index or because just the charts are good. However, there is an intermediate uptrend in the sector. So GE Shipping went up, took a lot of rest yesterday, it bounced back from the Rs 271 lows it made and closed at Rs 280 that told us there is lot of support even at slightly lower levels.

Thus, GE Shipping is a buying opportunity for traders today, so keep it for a day or two if you want. Rs 275 is a stop loss and Rs 290 could be a day trading target.

On Thursday last week, I had said that this doesn't have to work today and all of them worked on the next day--Friday. So, some of these ideas that we talk here are a primary roadmap rather than a precise number. However, if you are patient and wise enough they work out.

On GSPL:

I think it's good for triple digits. It is one of those stocks you need to own. The other one could be GMDC. I like the theme of companies that own properties which are diminishing in nature; mines, minerals, crude and GSPL qualifies in many other ways. We have already seen it making lifetime new highs; again it took a bit of rest. So after that rest strong stocks takes small rest and then rally again. So that stock again I would be watching today. So GSPL is a buy with a very modest target of Rs 97 and a stop of Rs 93. These stops should be listened to because either the markets will go through that up swinging cycle today, so it shouldn't look back. If it's not doing that then we get stopped out quickly.

On HPCL:

From Rs 450 was a point when everybody, including me, became bullish on the stock but it has is fallen to Rs 320-330, that's the market for you. But Rs 330 has been some kind of a double bottom and then a historical support is visible there. So this is one out of five stocks where we are expecting a bounce in anticipation. HPCL has been steady now; so buy it hoping for a big bounce - you never know. Rs 340 is a stop and Rs 354 is a target. If it moves up then it could be good for many more days.

On Nalco:

It has moved up, consolidated. On Monday, we were at the top of a short-term cycle and this morning we are at the lows. So the next one-two days should be for short-term traders, this is all about short-term. For the next one-two days we should be looking at slightly better prices across the board that's why all sorts of sectors are covered today. Thus, Nalco is a buying opportunity for short-term traders, Rs 388 is a stop and Rs 400 is a modest target.

Q: What about the market at large? Do you think the Nifty is good to take out its 5,180 top in the next few days or are you more cautious than that?

A: I am more cautious than that. My sense is that while short-term up moves will keep coming, I am not so upbeat any more. This year of consolidation that we are seeing is very difficult to say whether this is actually a distribution taking place. However, my own idea is that we will inch up slowly but that will be much slower than what we have seen. So 5,180 could take its time and then even after we take out 5,180, we could go back to 4,700 that would not be a surprise.

Q: What about Chambal Fertilisers. Have you taken a look at any of those stocks in the fertiliser, chemical space of-late?

A: Yes but I am not upbeat because fertilisers have disappointed significantly. They broke out of multi year trading bands and then they did nothing after that. So my sense is that it's far better to stay away from these stocks and momentum traders also will not gain because if the stock is not in a strong trend you do not get anything out of it.

Q: Are these dips in IDFC to be looked at as buying opportunities or has the chart weakened?

A: They are buying opportunities in fact the story still remains the same for all sorts of financials including banks. IDFC remains an excellent buying opportunity on every dip. I am not talking about value because this whole market is about momentum but IDFC, IDBI, all the banks we talked about, all the housing finance companies, there seems to be much more upmove ahead.

Q: One frontline chart check Mahindra & Mahindra, it made a 52 week high yesterday and is up nearly 100% in the past six months?

A: Yes it is; in fact it is leading the auto space and the whole auto sector is roaring. Stocks that make these highs need to be bought. The only point is that you wait patiently for a correction or a dip. M&M, Maruti Suzuki and Ashok Leyland all three appear to be on a roar and are likely to make lifetime high sooner or later maybe in a year, maybe earlier. I would say, the sector is good, the stock is good, just wait patiently for a dip.

Q: Chart checks on NIIT which you would have kept a lookout on and also Max India which moved yesterday?

A: I do not track Max. NIIT is a good chart but the problem here is I have a choice and I can go for NIIT Technologies which is a far better chart. So my sense is that NIIT is doing the right things for a midcap IT stock but I have to give an alternative and NIIT Tech is an excellent stock to own and to trade in.

Q: Do you think Unitech is headed further down?

A: The stock prices of real estate are in a mess and Unitech is headed further down and so are most of the other heavyweights. It's going to under perform and in a market that's going to remain choppy as I think it will, every rally will become a selling opportunity for real estate.

Q: What do you do you now, just keep holding a long or you should take your profits because you feel that it may not be such an easy climb up for people who have been long on the Nifty?

A: If you are a day trader, you can go long now looking at 5,150-5,140 as a short-term target. If you continue to carry longs from pervious days, the target still remain but look at modest profits and tomorrow is F&O expiry and strange things happen on that day. So my suggestion is you go with the momentum; the momentum is mildly on the bullish side for short-term traders.

Q: What about Sesa Goa at Rs 382? How would you approach that now?

A: You still buy it but not now. It's run up a lot; run up Rs 100 in just few days maybe 15 days, so wait patiently. We know everything corrects but Sesa Goa should be on your list, you must buy it on a correction as should be GMDC. These are themes which are long-term. I think they will be very rewarding to investors.

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