Uptrend still intact, buy today: Sudarshan Sukhani

According to him, today should be a day to buy.

Market Analysis: Can Nifty hop, skip & jump over 5400?

Below is the edited transcript of his interview with CNBC-TV18's Mitali Mukherjee and Sonia Shenoy. Also watch the accompanying video.

Q: Does it still remain a market that’s trending on the upside? Yesterday, you were talking about caution but, does it look like the market’s trend is intact?

A: Yesterday’s caution was justified and the market was choppy. The market trend is intact. So, after a choppy day, it’s reasonable to expect that the market can assert its normal trend, which in this case is up. Translated in more simple language it means that today should be a day to buy.

Q: You have a buy on Bata India for the day?

A: Bata went through a very sharp and sudden correction. That correction is over. Apparently that was not a downtrend and it was not anything deep, it just happened. It now appears that once the correction is over, the rally in Bata is clearly visible with higher highs, higher lows. Yesterday it broke out of a small trading range. That breakout tells us that the next target for Bata may well be Rs 900.
Rs 900 was its lifetime high and once we touch Rs 900 and cross it then we are in uncharted territory. All in all Bata is an excellent buying opportunity.

Q: GVK Power is in the news but you would choose to buy it today because the charts look good as well?

A: GVK Power was a buying suggestion ever since it was building out base and then coming out at Rs 12. It has been coming constantly in our buy list. Here is a stock that says that there is much more upside left. Yesterday, in spite of the fact that the markets were choppy, we had pointed out that there will be buying opportunities in individual stocks and those opportunities occurred. GVK Power was another one of those stocks that broke out of a trading range yesterday, rather than on Friday. It’s a good chart. I would buy it.

Q: How about something like a BGR Energy Systems , that’s on your buy list as well today?

A: BGR is an excellent chart, just beginning an uptrend unlike some of the other stocks which have broken out and are now going into the second leg of their move. BGR Energy in just entering an uptrend now. It’s made a beautiful head and shoulder bottom, which is a bullish pattern. It’s come out yesterday of that, confirmed that signal.

So, the traders here are of two kinds. You can go for a day trade or a swing trade for a couple of days or you could actually take a position in it and hold it till this rally continues. For all I know an immediate target is Rs 320 but an ultimate target could be Rs 360-370.

Q: You have a sell call on Max India ?

A: Max India rallied on the back of some news and since then it has been consolidating, it’s not moved up and to that extent it has been underperforming. I assumed that after a correction it will renew its rally. It has not done that. It’s actually broken down from a trading range. That’s not good news considering a market where everything is going up. So Max India becomes a short sell and the chances are that at worst it will do nothing but probably it will continue sliding down even in an up trending market.

Q: What about Sesa Goa that has been range bound for a while?

A: Yes it has been range bound and it has again come to that Rs 192-195 trading band from where it has faced repeated resistance not once but 5 times. So at resistance levels, Sesa Goa because it is in a downtrend of its own, it becomes a short sell and there is a stop loss.

If this time Sesa Goa crosses its resistance then we get stopped out and we also start looking for buying opportunities in the next few days. That possibility is there but at this point we are selling at the highs of this up move.

Q: You have a call on IDBI Bank it’s a buy for the day?

A: IDBI Bank is a buy. It has been a consistent underperformer among the financials and among the banks but that may well be changing. Just as we saw IDFC, which was in a bear market of its own and now seems to be out performing. IDBI could easily be one of those candidates. It’s not yet done that so I am just saying there is a strong possibility it could. If that is so then we are buying at the lows.

IDBI hasn’t actually done anything. It’s still building a base and the chances are that in this up move it will breakout. So we are literally buying just before a breakout occurs. I think it’s a good trade for the day for a positional trader because I expect the Nifty to move up.