Technical expert Rajat Bose expects the Nifty to rally to 8415 and advises traders to keep a stop loss at 8395.
Below is the verbatim transcript of Rajat Bose’s interview to CNBC-TV18’s Latha Venkatesh and Sonia Shenoy
Latha: How do you treat the Nifty this morning?
A: It depends as to where the Nifty opens and especially if it were to open above 8400 and then if it manages to move above 8415 then you put a stop loss below 8396 and expect that 8345 to 8353 kind of levels might be reached. These are technical resistance levels and if you analyse the option statistics then you get a resistance of about 8460.
8460 is coming as a resistance because last closing premium was about Rs 60 or so. So what I tend to think is that yesterday we had a range bound scenario between 8350 and 8400 and today the same range might well be shifted from 8390 to about 8450. Again as you said choppy markets are very difficult to trade. You have to buy weakness sell strength because that is a range bound market strategy when you do day trade.
But then whether the range that you are thinking to be the range would be the range, that is the moot point. If you can ascertain that, if you can foresee that correctly then definitely trading would be far easier. But that is a very difficult exercise to undertake. So I would say that let it sustain above 8415, then I put a stop loss 20 points down the road at 8395 and expect 8350 to be reached. But this actually from a risk reward point of view this doesn’t make much sense. I would still prefer midcap counters to actually play them because they give such good moves. Yesterday, there had been quite a few good moves that way.
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