Nifty may touch 5300; 50 point range no trade area: Sukhani

Sudarshan Sukhani of s2analytics.com, says that the short-term traders do not have any positions. He also says that the Nifty can touch 5300 level.

Below is the edited transcript of his interview to CNBC-TV18. Q: Would you keep your positions light for the day? A: Yes, I would keep my positions light and short-term traders do not have any positions. The definition of a positional trader for a week or two weeks - those who also should have been flat in the market. So the market is now also trading in a 50 point range. The real trade will come on this range breakout of 5,350, and now we can go down to 5,300. So, this 50 point range is a completely no trade area. Q: Suzlon Energy is a buy today? A: It is interesting because Suzlon has not been in a buy list. At Rs 16.80, Suzlon has come down to its pervious lows. Twice it has bounced from Rs 16.80. So, this is a very high risk buying opportunity and also a high reward trade if it works out even for a small amount of rally. We want to watch Suzlon. If the market behaves well and Suzlon holds to its support levels then it’s an excellent buy because Rs 16.50-16.80 support has held repeatedly. Q: You have a sell call on Syndicate Bank? A: Syndicate Bank made new lows on Friday. The public sector undertaking (PSU) banks keep on coming in our list as short selling candidates. They sometimes consolidate and then breakdown again. So, the same bank comes again and again. It is a dismal picture and the Bank Nifty is showing a very sorry state for bulls. While the Nifty remains in a trading range, the Bank Nifty has broken down from a similar trading range, so it’s worrying. But PSU Banks are selling opportunities. There is nothing to buy here. Q: You see more bullishness in Petronet LNG? A: It is making head and shoulder pattern. It is a rare pattern. It is consolidating and I would expect it to be a breakout eventually. As a disclosure, I would like to mention, I have some derivatives long positions in Petronet LNG. If the Nifty decides to go down, I do not think most of the calls on the long side will work out. If it remains choppy then some stocks will go up and Petronet is going to be one of those. Q: Jubilant Foodworks looks good? A: Jubilant Foodworks looks interesting and worth buying into. The outperformers will continue to outperform in a choppy market. Jubilant Foodworks has outperformed. It’s been rallying after that sharp dip. It was a in a narrow range on Friday. Since the trend is up, these narrow ranges are eventually dissolved on the side of the trend. In this case, they should be dissolved on the upside. So, it’s an excellent short-term momentum trading opportunity. Do not go short in any case. Q: What do you do with Cairn India? A: I would buy it. My sense is that Cairn is building some small bases. Some times it also cracks and come down. That’s just part of the base building exercise. But a stock that is building a base around Rs 300 and is willing to go up time and again is something I would go into. It’s been a favourite earlier also. I am long in Cairn. I would be long in Cairn India Q: You have a sell on Opto Circuits? A: We have been bearish on Opto Circuits and then eventually it started some kind of a rally. We said let’s go and buy it. Maybe it is bottoming out. That doesn’t seem to be working out. The rally was apparently a relief rally and it’s now breaking down from the trend line that was supporting that relief rally. That is not very bullish; it’s bearish because the broad trend seems to be down. For some of the stocks, it becomes difficult. I had thought earlier that it will go towards Rs 100. Then we thought maybe not, but now again that feeling comes in. The chart pattern suggests that a big decline is in the offing. _PAGEBREAK_ Q: How would you approach Apollo Tyre today? A: I would buy it. Apollo Tyre was a buying idea earlier last week. It has made a bullish pattern and broken out. I would expect this momentum to continue. Traders have to time it whether they want to buy it now, midday, tomorrow – that’s a different issue. But I can expect a target of Rs 90 eventually. Q: What about Indraprastha Gas (IGL)? A: Indraprastha Gas is giving a sense that it’s emerging from a decline. It has been building a consolidation, a base coming out of it slowly. But, IGL is not a day trading idea. I do not think anybody can buy IGL today and expect big rallies by the afternoon. It is certainly a position investing idea. I think IGL is coming out and probably moving much higher. Q: What about BPCL? A: BPCL is a high risk idea, in the sense that it’s fallen to Rs 340. Rs 340-350 is a trading range where BPCL has repeatedly found support, something very similar to Suzlon. At this point BPCL has said that it’s finding support and willing to go up because on Friday it went up. I would say that BPCL is a buy. We already have a tight stop loss. If this is support and it holds we can see a very decent tradable bounce on the upside. So, buy it with a tight stop loss. Q: Where is a support on State Bank of India (SBI) now? A: There is no support. There is some visible support at Rs 1,800, but the fact that it has fallen like ninepins is worrying. For all we know Rs 1,800 support can hold. But, SBI needs to do a lot of work in this Rs 1,800-1,900 or even Rs 2,000 area before we can start saying okay, this is a buy every time it falls. It’s just the opposite now. So, if somebody wants to sell SBI with a tight stop loss - that’s probably a better idea. Q: Which direction will Bharti Airtel take from here? A: It is difficult to make a call. On the chart, when stocks like this breakdown is in this fashion we have to say to sell it, to short it. An immediate downside target is Rs 240. Whether it will reach there or not is difficult to say. It is much easier to say not to buy. Q: A word on Ranbaxy Laboratories? A: Ranbaxy Laboratories is going down. It is worst of all the three charts - Rs 460-470 on the downside is likely.