Mkt still in downtrend; avoid buying any pullback: Sukhani

In an interview to CNBC-TV18 technical analyst, Sudarshan Sukhani of s2analytics.com shared his outlook on market and stocks across various sectors.

Expect limited market downside ahead: Birla Sun Life Below is the verbatim transcript of Sukhani's interview with CNBC-TV18. Q: How would you approach even a mild pullback on the Nifty if we get it today? A: Yesterday my suggestion was to close short positions for the short-term trader because there has been very decent gain on the downside. The view still remains that we are in a downtrend but this rally is not likely to be tradable at least that is what the view is as of now. So, if there is a pullback I am out of the market. At some point I would look to go short and reinstate the positions that would be around 5,800. However the markets do not respect levels, they won't oblige me by going to a number and say sell again. Therefore, the levels are dynamic but I am not looking to buy any pullback, just step aside. See Nifty rangebound between 5700-5750 levels: IIFL Q: Your buy list is full of blue-chips; start with Tata Consultancy Services (TCS). A: Blue chips are the only thing we can buy. We have not been talking about midcaps, not going long in them and the suggestion has been that blue chips are the only sector where some money can be put in. TCS after a brief decline rallied yesterday. That suggests that any pullback today should see continuous follow through. The percentage gains in blue chips are less but at least they are gains, they are not 20 percent losses so that should be consoling and derivatives will give us leverage also. Therefore, TCS is a buying opportunity. If the market stays still in the morning and they should, consider going long. Q: You are long on Indraprastha Gas (IGL)? A: That is a very nice chart. IGL was making up its mind whether to go down or go up; apparently it rallied about ten days ago and that suggested that it was willing to go up. A decline following together with the Nifty but it stopped at Rs 260 support and is now it is one of the better stocks in the oil and gas sector. I think there is more upside here. Probably a positional trade or even an investment is justified in this treacherous market. Therefore, today watch IGL. If one sees a slightest signs of strength, go long. Disclosure: Sudarshan Sukhani has no holdings in the stocks discussed. _PAGEBREAK_ Q: You have a sell on Reliance Capital, which collapsed? A: It is collapsing everyday. Reliance Capital is falling day by day and relentlessly. I had explained that the Anil Dhirubhai Ambani Group (ADAG) is in a bad bear market, a disappointing bear market and Reliance Capital is leading that. There is more downside here. We cannot even discuss the levels that it can eventually go to. At this point, in a choppy market and in a market that is not completely one sided today on the upside. That seems unlikely. Reliance Capital is a sell. One should see follow-through of yesterday’s decline. Wait patiently, in a couple of hours one will get a small rally then sell into the rally.  Q: You are also selling Allahabad Bank from the banking space? A: Yes. Allahabad Bank is making new low. The Bank Nifty also did that although Nifty has not done it; still holding on to life with 5,660 intact. Allahabad Bank is going with the Bank Nifty, actually underperforming even the Bank Nifty and because it fell on Wednesday from trading a range, there is a shorting opportunity today. Some of them have fallen so much that one cannot even sell until they rally. However, the breakdown here suggests that one can go short. Q: You are selling Opto Circuits India as well? A: Yes, from Rs 200 onwards it has been a single trade here. Sell at every opportunity. I have no idea why this is happening. The Rs 5 rally was a bear market flag. It has cracked again. It will go below Rs 47 and probably look for lower levels. It is difficult now to imagine what the levels will be but that is the story. Sell it; keep a tight stop loss because midcaps can sometimes do strange things on the upside. However, the money is on the downside. Q: You have a long call on Hindustan Unilever? A: We have been upbeat on HUL even last week. The process of bottoming out sometimes causes some minor pain. However, with HUL the trade was easy. The charts are suggesting that it is bottoming out and even if it goes Rs 5 below our cost price, the chances are it will recover, which it is doing. It is one of the very few blue chips apart from the big pharmaceutical and IT names that one can consider going long in and at every dip. So, HUL should see a continued follow-through of yesterday’s gain and the idea is if it does not and if one is patient then in the next two-three days one will make money out of it. Q: How you trade the index. It looks like a quiet kind of upstart about 10-11 points? A: We will not buy the Nifty and certainly not the Bank Nifty. One should wait patiently. Either there is a rally, when we sell into it or if the Nifty starts breaking down below that 5,690 levels then the breakdown will be a short sell. _PAGEBREAK_ Q: You have been bullish on many of the pharmaceutical names but does that include Orchid Chemicals and Pharmaceuticals? A: No, it does not include Orchid Chemicals and Pharmaceuticals. It is a short sell. It is to be avoided. By no stretch of imagination is it a buy. One should just stay away. Q: How would you trade Ambuja Cements because it looks like cement maybe under pressure? A: It has broken below all support level so short sell it on rallies and avoid buying. This is a falling knife situation, one cannot go long. It is a sell, all cement. Q: You have not been very bullish on this and the stock has collapsed, where is the critical support on Delta Corp? A: An immediate target is Rs 38 but there is no support because it is now in a free fall. It can stop wherever it wants and it won't stop easily. The momentum is so strong. It is going probably below Rs 30 also. Q: Your views on IDFC? A: IDFC is a disappointment. It was a favourite but an immediate target on the downside could be Rs 130. It is a sell. One does not have to sell some of these stocks. Therefore, IDFC is to be avoided. Q: How would you trade Pantaloon Retail? A: It is a disappointment. It was on rally. I thought it is entering a bull market. The market is wiser. Now we are looking at Rs 140 maybe even lower levels. That is a pity. Q: Your thoughts on Lupin? A: Lupin is a buy. We have been putting in our buy list repeatedly. Every dip in Lupin is a buying opportunity. Buy it even in a falling market if there is a small dip.