Market in short-term uptrend, go long: Sukhani

In an interview to CNBC-TV18, technical analyst Sudarshan Sukhani of s2analytics.com spoke about his reading of the market and the road ahead.

"We have had a very sharp correction and that correction will see a relief rally and these relief rallies are tradable. So, we want to be on the long side at this point of time. In fact, the position trades that were taken at 5,980-5,940 could easily be closed as of now," he said in an interview to CNBC-TV18. Below is the verbatim transcript of Sukhani's interview with CNBC-TV18. Q: If we do get a bit of a bounce up, a small gap up for the market how would you trade. Is there more to go assuming that the short covering coming or would you look to book profits on a long position now? A: There is more to go and we are in a short-term uptrend. We have been trading with a bullish bias or rather with an uptrending view since Monday. Monday did not work out, yesterday it did and today that view continues. We have had a very sharp correction and that correction will see a relief rally and these relief rallies are tradable. So, we want to be on the long side at this point of time, in fact the position trades that were taken at 5,980-5,940 could easily be closed as of now. DIIs to blame for midcap carnage: IIFL's Nirmal Jain There is a profit on the short side and that profit can be taken. I expect market to rally more than where we are now and we can reinstate the short positions once the market are at a higher level and show signs of exhaustion. That is not happening. It is just the beginning of what promises to be an interesting rally. So, we will be long.  Q: You have a sell on Voltas today? A: Because Voltas has not participated in the rally that we saw yesterday. Voltas is also making a narrow trading range that usually breaks out on the direction of its primary trend. If primary trend is down so very disappointing the stock could move down even as the market goes up. Since the short-term bias is up we do not want to short sell many stocks because more stocks are likely to go with the index. Investors seem disinterested; Nifty to slip further: Baliga Q: Bharti Airtel is on your buy list. What kind of a target price would you set out there? A: The eventual target price for Bharti’s upswing is Rs 345-350. Bharti has made attractive bullish head and shoulder pattern and it is on the verge of breaking out. I am assuming that breakout will come. We are buying in anticipation. However, last two days have seen good rallies and that breakout is imminent if not today, tomorrow. We should be positioned on the long side. The heavyweights are obviously going to contribute to the Nifty’s rally, so it is a good idea to go for heavyweights where the patterns are very clear. Bharti is one such pattern. I have been upbeat on Reliance Industries and Bharti Airtel and fortunately for me Bharti has given a clear buy signal. Disclosure: I have no holdings in the stocks discussed. _PAGEBREAK_ Q: Are you seeing more in the pullback for GMR Infrastructure? A: I think so. GMR was in a trading range and GMR was identified as a buying opportunity on Friday itself. I said finally the midcaps are looking up. It took its time, but the rally has just started. I see more upside here. It is coming out of a small base, but that is good enough and a strong support at Rs 17.50-18 has held for GMR. Therefore, strong support, the base holds, trading range has been taken out on the upside, all said and done a good chart to be in. These are midcaps. One must follow discipline by taking profits as also by keeping stop losses. Q: You have a buy on TV18 Broadcast? A: Yes and that is probably the first time that I have put TV18 in my buy list because the stock price inevitably disappoints. One has seen how it went up to Rs 37-38 and come back to Rs 25. What is happening now is at Rs 25 there is a strong support area in TV18. Just like GMR it has gone through a minor consolidation and it is on the verge of breaking out from that consolidation on the upside. As I have explained the next ten days could be good periods to be in midcaps. We have a stop loss. I do not think TV18 is coming down because it has seen much better prices and even a relief rally can take it 20-30 percent higher. It is a stock worth going into. Q: What about Lupin that you have picked up today? A: Lupin has not done what the other stocks have done, it has not gone up. That probably suggests that there is more room here for a breakout. It is in a trading range for one-and-a-half months. Given the basic environment that the Nifty could actually move higher I think Lupin will eventually breakout. It is buying in anticipation but there is no harm, because once we are sure about the short-term trend we can easily say that these blue chips will also perform. So, Lupin comes in that category. Buy, if it does not breakout today it will breakout tomorrow or day after, but it should. Q: You have a buy on Tata Power? A: Power stocks were badly hammered. Tata Power fell from Rs 115 to Rs 95 and that is 20 percent. That bear market maybe ending, if not ending at least it will participate in the rally that the Nifty is now beginning to show. However, Tata Power has fallen. After the decline it fell, it went into a consolidation. So, it did not actually fall when the Nifty fell on Budget, because it has already done its thing earlier, but that is good news. The market said this is the worst we are going to see in this price. Budget or no Budget it is not going down further. That consolidation is now ready for a breakout. We are anticipating a breakout, but it should come about. Many of the stocks where we are anticipating are giving us opportunities to enter at fairly low prices. Q: This looks like the quantum of the gain, about 0.5 percent on both indices. If you are trading long, what kind of stop losses are prudent at this point? A: If one is trading long then the stop loss currently is 5,750 and that stop loss will change during the day as the market builds on its strength. There is a slightly wide stop of 60 points when compare to the possible open. However, that is acceptable. Q: How would you approach Essar Oil this morning? A: Theoretically it is a buy. I do not like buying after big moves because the stock then tends to consolidate. So, ideally one wants to time his entry on the long side when the stock is going through intraday consolidation. However, the trade is to buy. I think the decline in Essar Oil is probably over; yesterday’s big move has covered a lot of ground. Q: How do you track Power Finance Corporation (PFC) this morning? A: Buy it. There was a sharp correction in PFC but that exactly what it was; it was a correction in an ongoing bull market. Power Finance Corporation is likely to outperform the Nifty and most other finance companies so I would be a buyer in PFC. Look at a target of Rs 208-210 in the very short-term and probably a much stronger momentum as prices move up. _PAGEBREAK_ Q: Technically would Mahindra & Mahindra Financial Services be good for more? A: In an upswing market everything is good for more but I would not be a buyer in M&M Finance. There is a difference between M&M Finance and PFC. M&M Finance broke all its earlier support levels in the decline that was just continuing till yesterday. It is not a buying opportunity. It is theoretically a sell. Since it is not in the Futures and Options (F&O) segment, one cannot short it but it is a sell otherwise. If one own it for a short-term trade then get out of it on a rally. Q: Do you have enough data on Multi Commodity Exchange of India (MCX), how would you approach that? A: We have enough trading data to say that we have been bearish and downbeat on the stock after the first few days of price action was assembled. It is still a short sell. It is a selling opportunity. There is nothing to buy. MCX will see much lower levels during this year. Q: How do you approach Idea Cellular today? A: Buy it, in spite of the small decline one has seen over the last few days Idea is in an upswing, these declines are exactly that small dips in an ongoing bull market. Ideally because there is a dip, one is getting the stock at a lower price. Go long in it. Q: How are you trading the currency now because that is as volatile as the equity market?      A: It is moving absolutely with a lot of a correlation; when the Nifty goes up the currencies go down. As a short-term trader we are bullish on the rupee and we are looking towards 54/USD because our bullish view on the Nifty is also short-term. Q: Leaving the Nifty aside where else do you see more opportunities in terms of the front liners? A: First, one must look at the bank index. The Bank Nifty is giving the same opportunity, slightly better so the Bank Nifty is the buying opportunity. At 11,800 there is more upside here so we want to go long in that. The two stocks I would be interested in buying are Bharti Airtel, which was in my buy list this morning and Reliance Industries, which is likely to significantly outperform the Nifty over one year timeframe and even now we want to go in stocks that will outperform. These are the two largecap performance stocks that we can discuss.