Sudarshan Sukhani advises to buy on dips; suggests stocks

The Indian market has been listless over the last many sessions. In an interview to CNBC-TV18, Sudarshan Sukhani, s2analytics.com says the trade still is, for intraday traders, to go and look for buying opportunities. "I would not buy immediately in the morning. It is always wise, in a choppy market, to wait for that inevitable correction or dip," he adds.

 Don't miss: 87 cos disappear after raising capital through IPO Below is the edited transcript of his interview with CNBC-TV18's Mitali Mukherjee and Reema Tendulkar. Q: It looks like we may have a strong start. Would you buy into that strength today on the index? A: Yes, I would. But I would not buy immediately in the morning. It is always wise, in a choppy market, to wait for that inevitable correction or dip. But the trade still is, for intraday traders, to go and look for buying opportunities. That trade has been consistent for the last three-four days. That will continue today. I will also take out the positions by the end of the day. That means this is not the trade that needs to be carried forward. But the slight bullish bias, which we have been experiencing, continues. Q: Do you think there is more weakness in-store for Ultratech Cement? A: I think so. Cement is going through a correction. I had earlier suggested that this correction is going to be deep and there is no rush to buy cement stocks. That seems to be working out. Ultratech is not in a downtrend of any kind, so we cannot say avoid this stocks. For short-term traders, even a correction sometimes is tradable and that is happening in Ultratech. Yesterday, it broke from a support range and that tells us there is more downside for the stock. So we try to trade the downside till significant support comes in and that may take time. Q: You also have a sell rating on National Thermal Power Corporation (NTPC) for the day? A: Yes, NTPC has been a very disappointing stock. It is in a downtrend. For example, Ultratech is in the correction, and we are trying to trade that correction but NTPC is in a clear visible downtrend. So we want to go and follow that trend. Yesterday, the signs were that a new decline would start, probably today, and that is something we want to catch on to. So NTPC is a short sell, probably a positional short. Q: You have got a whole bunch of non-index faces though that are on your buy list, let us start with Exide Industries? A: Exide is an interesting stock. I was upbeat on it. Then we saw signs of distribution and thought of getting out. We were lucky that we got out because  Exide fell from Rs 168 to Rs 130 on back of bad results. But a good stock cannot be held down for long. After that initial decline for the last two months, Exide is in a trading range. It is not falling, so it is probably building a small base from where it is willing to go up again. Those initial signs of a breakout on the upside are coming. We want to take that chance and go long in Exide. If it does not work out today, it will work out in the next few days. This is a stock that is now going back to its earlier highs. Q: Bata India is back on your list after a long time Bata. A: Yes, because Bata made a distribution and actually started falling and we cannot buy a stock that is falling. It has gone through a correction of its own and that correction is over. Yesterday, Bata had a significant upmove, that upmove came on the back of five-six days of very narrow range trading. Looking at narrow ranges, significant upmove, we want to go back in the stock. Stocks that begin these strong trends usually do not stop and that is what is happening to Bata.Rs 1,000 is very likely on Bata. Position traders should also consider initiating a position in the stock now. _PAGEBREAK_ Q: How would you approach Apollo Hospitals? A: I would buy Apollo Hospitals and there are two reasons for that. One, Apollo Hospital has been in a consistent uptrend. For many months now, I have been making this theme that this market is rewarding strength and not rewarding weakness. So, to buy on weakness is not a good idea. Apollo Hospital has been consistently seeing an uptrend. For the last three days, it has been making inside days, which means very narrow days, one inside the other; their bars are very narrow, they are narrower than the previous day. These inside days, in an ongoing uptrend, tell us that a significant new upmove is coming. Unfortunately, I cannot time it and I cannot say today is the day but if not today, then tomorrow or day after, the big move in Apollo Hospital is coming. So traders should position themselves today itself and not get worried if it doesn't move today, it will in the next few days. Q: You are bit bullish on Larsen and Toubro (L&T). A: Yes, L&T had this big rally and a very decent and sharp correction. It stopped after the correction and that is good news. The rally we saw in L&T was fairly large and there was no correction, there was no stopping but it has done that now. It has paused, come down 150 points and it is now beginning a new upmove. For all I know, that upmove can cross Rs 1,700 this time. Some charts are bullish, some charts are bearish, so it is very difficult to make a call on the index but L&T's chart tells us that there is more upside here. Q: There has been a lot of talk about how December historically delivers for the market, from what you see in terms of monthly targets, what is it looking like because we have had two extremely range bound sessions for the market in the past two series? A: Yes, we had two extremely range bound sessions and yesterday, we had a remarkable session where the Nifty moves just 26 points during the day. That is a record for many years. Apart from the two months, the immediate narrow range tells us that the markets are willing to take a move up or down. Since, today we are likely to cross that 5,630-5,650 resistance, traders must position themselves on the long side. They must close short positions and position themselves expecting a rally. If this rally comes about, it will immediately face resistance around 5,730 but that is another 60 points of profits, which are possible. Later we will take it from there. Q: What would you take away from today’s market opening? How would you trade the Nifty given that tomorrow we have got a day off from trade? A: We are only looking at intraday trades on the Nifty. The bias is long for the day and that is what we have been doing, moving day-by-day. There are some positional shorts, which were left after profits were taken. Those shorts should probably be closed by the end of the day because we have a holiday, so it is not a good idea to carry them. For today, we are looking at buying on a dip. Wait for the first 15 minutes after the opening and if the market shows strength, then go and buy on any intraday correction. Although there is no rush, buying should be done. _PAGEBREAK_ Q: Mahindra and Mahindra (M&M) fell quite a bit yesterday, it was down close to about 3 percent, how will you approach it today? A: I would buy it but maybe not necessarily in the morning. We have to wait patiently for the markets to tell us that the decline is over but M&M is a very strong stock. These declines will come. Practically it is not possible for a share to move up relentlessly day after day. A dip in M&M is a buying opportunity with an eventual target of even Rs 980. So just be patient, find a location and go in it. Q: Yesterday IT had a fairly good session; do you expect the upmove to continue in names like a Wipro? A: Yes, I do. Yesterday, in fact Infosys was a buy for us. Wipro is probably as good as anything and it came in our buy list earlier as well. I would expect IT stocks to have a rally, all four-five of them. HCL Technologies has come in our buy list repeatedly. We are looking only at the four largecaps and not the midcaps. Q: Karnataka Bank had a 13 percent rally in the last three days, is that looking stronger than the rest of the PSU banks? A: Karnataka Bank is looking stronger, although I do not track it and I do not trade it. So for me, it is only a chart and on the charts, it is looking very strong. This rally has been remarkable and there must be some reason behind it. After such a large rally, is it wise to enter it even as a day trade? I do not know. Theoretically, it is a buy; practically it is not a good idea. Q: How does Ballarpur Industries (BILT) look technically? A: BILT is a very good stock to be in. It has come in my buy list repeatedly. After I said let us go and buy it, BILT went into a trading range for two months. That is the way markets behave; just because we are tracking it, does not mean they have to go up. Eventually, it has broken out. Midcap stocks like BILT require a lot of patience. It is not a stock that you want to day trade but you want to make an investment. At current levels, it is a very nice idea, we should be looking at Rs 32-33 in a year’s time which is a handsome gain. Q: Wockhardt is a stock which has defied gravity, how would you approach it at these elevated levels? A: It has defied gravity. It started from Rs 400 and when it came to Rs 900, I thought I should buy for maybe a gain of Rs 100. But from Rs 900, it has doubled itself. Initially we bought when it had doubled and then there was nothing to stop it. After that we have been saying go and buy it, on every dip and that still remains. There is nothing to tell us that Wockhardt has stopped its rally. It is still a buy, every intraday dip; every proper correction is a buying opportunity in Wockhardt.