See limited downside for mkt; buy on dips: Hemant Thukral

In an interview to CNBC-TV18, Hemant Thukral of Aditya Birla Money spoke aboout his reading of the for the Futures and Options (F&O) market and road ahead. He believes the downside to the market is limited because bullish sentiment still prevails.

"I do not see this market cracking below 5,780-5,830. I feel that 50 point range will act as a support for the market,"said Thukral. He further adds, apart from few hedging positions in stock Futures, the foreign institutional investors (FIIs) are still buying Below is the edited transcript of his interview on CNBC-TV18 Q: What is your call on the index after the ranging movement of the last week or two for the rest of the December series? A: The way the writers have placed their positions, the market has a limited downside. I do not see this market cracking below 5,780-5,830. I feel that 50 point range will act as a support for the market, so bullish sentiment is prevailing in the market. Once we cross 5,950 or 5,960 on the cash side, which was a resistance last week, I think we can move up to 6,000 levels. One must not forget that liquidity is on our side, foreign institutional investors (FIIs) are still buying apart from few hedging positions in stock Futures but their cash buying figure is still being maintained. Importantly, India Volatility Index (VIX) which had gone up to 16-17 has now gone well below 15.So it’s suggesting that there is no real panic among the market participants even when the market came down to 5,830-5,850. So the sentiment is positive, individuals stocks are forming long positions. I firmly believe that we may consolidate, we need triggers but I still have a positive bias. So any dip in the market due to some small corrections, which will be a shallow correction should be utilized as a buying opportunity. The first stop loss remains at 5,830 in cash level and if it maintains then the target is 5,960 and then if it crosses the second target is 6,030. Q: You have got a strategy on Union Bank of India? A: Bank Nifty is the main backbone of this rally. I still feel the Bank Nifty is the one which has to be watched out. More importantly, the way the public sector undertaking (PSU) banks are behaving,  and the way the open interest is being added up on the long side, we have chosen Union Bank of India. Union Bank has again added 16 percent open interest on Friday and the cost has moved up suggesting that lot of long positions have been added up. Technically, Union Bank is now trading well above Rs 256-257 levels, which was its six to eight month high. It is clearly forming a higher base now so if a trader can keep a stop loss of Rs 262 then in immediate short-term I see target around Rs 278-279. Having said that, all the PSU banks like Bank of Baroda, Punjab National Bank (PNB) are adding very aggressive long positions. So they can be the next leg to carry Bank Nifty forward. Q: NMDC has shown signs of strength post the issue getting over? A: NMDC is one counter which has seen very aggressive built-up. Before the issue there was a huge built-up which was on the short side and still those shorts are open in the market. The way the counter has stabilized now above Rs 155 levels, I have a feeling if it crosses Rs 163 then one will see lot of short covering along with fresh buying coming in. The way the delivery based volume was happening on Friday, I see an immediate short-term target of Rs 172-173 on the counter. Traders have to keep a stop loss, so I would keep a stop loss of Rs 156-157 on NMDC.