After finally closing above 19,500, "there are greater chances that the Nifty may certainly test 19,800-19,900 levels if we take some cues from the Options data," Milan Vaishnav, CMT, MSTA, founder and technical analyst at Gemstone Equity Research says in an interview to Moneycontrol.
As the Nifty IT index had seen a huge buying on last Friday, he believes it is certainly a great time to start accumulating IT stocks.
Milan with nearly two decades of experience in the equity markets, expects the banking space to play catchup. "ICICI Bank is set to witness a breakout; I would focus on ICICI Bank as one of the stocks that can see a swift rally if it is able to keep its head above Rs 960-970 levels," he said.
Q: Is it the right time to buy RBL Bank that has been on buyers' radar since April?
Although RBL Bank has been on the buyer's radar since April, the first entry point came on June 30 when the stock staged a breakout when it crossed Rs 180-182 levels.
Currently, the stock remains in a strong uptrend. There is a room on the upside and the stock has the potential to test Rs 265-270 levels over the coming months. Some consolidation cannot be ruled out; one can accumulate the stock between Rs 198-210 levels if it sees some consolidation.
Q: Will it be an easy ride for the Nifty50 to climb above 20,000 mark in current quarter?
With the kind of trending moves it saw in the previous trading session, Nifty has certainly opened up some more room for itself on the upside. The levels of 20,000 are definitely psychologically important levels from one perspective. There are greater chances that the Nifty may certainly test 19,800-19,900 levels if we take some cues from the Options data.
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So far as testing 20,000 levels in this quarter is concerned, it would be premature to put expectations without any rationale. In fact, two things can happen; the Index can go near 20,000 and also face strong resistance there.
Q: Do you expect Nifty Pharma to surpass its record high levels in coming months?
This can be answered from a different perspective. The Nifty Pharma Index witnessed a breakout when it crossed above 13,000 levels.
Presently it is some 5 percent away from its high point; however, it remains overbought and may see some consolidation. That being said, the Pharma space is set to relatively outperform the broader markets and this may definitely see Nifty Pharma to surpass its record high levels over the coming months.
Q: Two stocks which can see swift rally in rest of July?
I expect the banking space to play catchup. ICICI Bank is set to witness a breakout; I would focus on ICICI Bank as one of the stocks that can see a swift rally if it is able to keep its head above Rs 960-970 levels.
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Another stock that I see is from a largecap IT services space. LTIMindtree is set to stage a breakout; any sustenance above Rs 5,100 can see the stock meaningfully higher than its current levels.
Q: Are you a big fan of real estate sector?
You can call me a big fan of anything that portrays strong Relative Strength. The Realty sector index has been inside the leading quadrant of the RRG (Relative Rotation Graph) for many weeks now; this is the reason that we are witnessing a strong relative performance of the realty space against the broader markets.
This is likely to continue; however, we cannot also rule out this space taking a breather and consolidating. The testing of 550-565 levels by the Realty Index would lead to testing of a major double top and some consolidation at those levels cannot be ruled out.
Q: Given the strong run up in Nifty IT on Friday, is it really a great time to start picking stocks in the sector?
Yes, it is certainly a great time to start accumulating IT stocks. I will have a stock-specific approach while doing this. TCS, Tech Mahindra, Infosys, LTIMindtree, Tata Elxsi etc are some of the stocks that are on our radar.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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