See expiry near 5910, bet on Bank Nifty: Aditya Birla Money

The December futures and options contracts will expire today. In an interview to CNBC-TV18, Hemant Thukral of Aditya Birla Money says he does not expect a big rally today. "I expect expiry around 5,880-5,910 levels only," he adds.

According to him, one should maintain long positions, although 6,000-6,030 level will prove to be a slight resistance. "Until we cross that, I do not think the rally towards 6,150 will progress, but first target for the Nifty remains 6,030," he asserts. He is still very positive on Bank Nifty. Also read: Sudarshan says, Nifty to breakout soon; buy on dips Below is the edited transcript of his interview on CNBC-TV18 Q: Yesterday was a big move for the Nifty, but how are you approaching expiry in the January series? A: The positiveness in the market is maintained because there are a few data points pointing towards that positive. First, the rollover cost has reached a calendar high. That means for the whole of 2012, this month has the best rollover cost going forward. That in itself shows the underlying sentiment is getting positive. Second, the midcap stock Futures open interest going forward, in January series has moved up already. That suggests trading interest coming back into the market. Third, the India volatility index (VIX) continues to be on the lower side of the market, which tells us that even at such higher range; the market is not seeing any volatility coming in or panic within the investors. So, people are expecting the market to move up. The only concern is the writers' position. Even as we go forward in January, the level remains the same, 5800 Put and 6,000 Call, which suggests that the writer is expecting Nifty to face problem around 6,000-6,030 levels. I think since the positivity is maintained, one should maintain long positions although 6,000-6,030 will prove to be a slight resistance. Until we cross that I do not think the rally towards 6,150 will progress but first target for the Nifty remains 6,030. Q: What do you expect to see today after yesterday's rally, an expiry around 5,900 level or do you see the possibility of the Nifty inching higher towards 5,930-5,950 by the time we are done with the settlement today? A: I am expecting a market settlement towards 5,900. I am not expecting same fireworks as yesterday because majority of the rollovers are in place and the short covering has already been taken place. I do not expect big rally today, but I am expecting the market to expire around 5,880-5,910 levels only. Q: What about the Bank Nifty, on that there has been some concern on how to approach it. In January have you seen any rollover of short positions, any extended pressure on it? A: No, in fact I am still very positive on Bank Nifty. Yesterday, Bank Nifty has picked up on the rollover front so it’s not showing same concerns. In fact the biggest concern was private banks not showing same amount of rollovers but yesterday the way ICICI Bank picked up on the rollover front, it started giving comfort signals and public sector undertaking (PSU) banks are showing good rollovers. So they will continue to show the run up, I think Bank Nifty is the main requirement if Nifty has to cross 6,030 levels. If you are maintaining longs on Bank Nifty, 12,200 should be kept as a stop loss level and first target should be 12,650 and then 12,800. Q: What about IVRCL which saw a bit of interest yesterday, do you see more gains going into January there? A: Midcaps have started showing rollover interest and yesterday IVRCL picked up on open interest as well as the rollover front. So you can expect some positive movement for intraday today also, but going forward in January series the next target should be around Rs 48-49. Traders have to keep a stop loss and it has to be around Rs 43. In the January series, the way the rollover cost and the rollovers are taking place, traders should make at least 8-10 percent going forward. Q: Real estate has been one of the strongest sectors this series and you have a trading call on DLF today? A: Yes. The high beta stocks continue to show very aggressive rollovers and real estate is a perfect example of that. All real estate stocks, you can even including HDIL or Unitech are showing good rollovers. The leader DLF is showing very aggressive rollovers, already 69 percent positions have been rolled and not only that the cost, as in all counters, is on a very aggressive front. That clearly suggests that in January series you can see breakout above Rs 228-230 mark, which has been a slight resistance point for it. We recommend long on DLF with an expected target in January series around Rs 239-240 levels. Traders have to maintain a stop loss at Rs 215. _PAGEBREAK_ Q: Yesterday Bharti Airtel stood out amongst the telecom stocks, what action did you see in your part of the market on that? A: Yesterday Bharti saw a pickup on rollover front. Though the other counterparts in telecom are suggesting better rollovers  but Bharti continues to show aggressive long rollovers. On the weekly charts, Bharti has now consolidated well above giving a breakout. It will continue to move but the crucial resistance remains at Rs 340 levels. I feel now it has shifted that range northwards, so we may not see Bharti going below Rs 310. It may remain in a range between Rs 310 and Rs 340. Once it crosses Rs 340 then a better rally can be expected. Q: Start of the December series have been the metal stocks, anything that is showing you continuing momentum or good rollovers going into next series? A: Like all high beta, metal costa have also improved a lot; clearly showing that psoitivity in the market will have a rub of effect on the metal stock I would choose two stocks, one is JSW Steel which has shown very rollover of around 80 percent positions have been rolled. Second is Tata Steel which has shown good rollovers and much higher cost than all other peers. For JSW Steel a target of Rs 875 should be kept in mind and for Tata Steel a target of Rs 445. These two levels should be watched in this counters and I am expecting these two to out perform the metal pack going forward in January series. Q: Any individual stocks on which you expiry volatility today? A: I am expecting some run up in IT stocks. I am watching both Infosys and TCS very carefully because there are still some outstanding shorts. In these two I am expecting some short-covering in the later half today. I think IT as a pack should be kept on the radar for any volatility if you are expecting in the positive side towards the later half today.