There could be a lot of long unwinding in the last hour of trade on Thursday, says Religare Securities' Manoj Murlidharan.
Talking to CNBC-TV18, Manoj Murlidharan, head of derivatives, Religare Securities, said he expects the Nifty to be near 7,950 levels on expiry. He said the Nifty might reach a high of about 7,980 to 8,000 during trade on Thursday.
He expects a lot of long unwinding to happen in the last hour of trade on Thursday. The Bank Nifty is going to be topping up. He said that the last hour would see some selling.
Gaurav Bissa of LKP Securities expects Nifty, which is stuck in range of 7800-8000, to trade at same levels in the next trading session.
Murlidharan recommended selling State Bank of India at target price of of Rs 186 and a stop loss of Rs 207.
He said April has been a good month in terms of the net gains in the Nifty and Bank Nifty.
He suggested buying Dabur with a target of about 281 to 283 and a stop loss of 268
He recommends buying Pidilite Industries with target closer to Rs 622-623 and a stop loss of Rs 597.
He finally gave a buy on Tata Communications target of around Rs 426-428 and a stop loss of Rs 415.
Bissa has buy calls on Jet Airways at target of Rs 680, Lupin at Rs 1600 and Century Textiles at a target price of Rs 605.
Below is the verbatim transcript of Manoj Murlidharan’s interview with Latha Venkatesh and Sonia Shenoy on CNBC-TV18.
Sonia: It has been a very good series, what is the strategy for today?
A: April has been a good month in terms of the net gains both in the Nifty and Bank Nifty. However, if you look at the rollovers, I guess the rollovers in the Nifty Futures were almost done on Tuesday and Wednesday itself when the Nifty rallied a good 110 points odd. It is the Bank Nifty that is shying away from the rollovers; if you see, it is just 47 percent odd.
So, I am expecting a lot of long unwinding to the position that is happened right from the time if you remember, the day of the Budget where the Bank Nifty bottomed out and till yesterday we have seen the Bank Nifty has rallied a good 1,000-800 points and there would be certainly long unwinding that would happen in the last one hour of trade which is more or less qualified as the volume weighted average price.
So, the trend or the levels that we are looking here is 7,980 to 8,000 should be the top for the Nifty for today’s trade. You can short Nifty at that level, keep a stop loss of 8,030 and we are expecting the Nifty to come down to maybe a 7,930 to 7,940. The expiry however might be closer to 7,950, plus or minus 10 points.
The Bank Nifty as I said would be topping up so there are a couple of stocks like an ICICI Bank and State Bank of India (SBI), especially SBI where there is a lot of open interest which is yet to be rolled. We would see some selling in the last half or one hour of the trade. So, our trade would be to sell SBI let us close to Rs 198-200 and keep a stop loss of Rs 207 and a target of Rs 186 is what we are expecting on that.
Latha: Any specific stock you would play besides your short call on the Nifty?
A: We like three stocks, the top is Dabur. It is a stock where we have seen good volume weighted average price (VWAP) buying which happened in the last three days and we still recommend buying that at Rs 273, a stop loss of Rs 268 and we are expecting a target of close to Rs 281-283 on that.
Pidilite Industries is an excellent stock. We feel the cash buying which has happened, it has happened in a very neat pattern over the last five to seven odd sessions. That should be bought in the cash market or for the May futures you can buy that. Rs 607 is where we recommend buying that, Rs 597 as the stop loss and we are expecting a target closer to Rs 622-623.
The third pick would be Tata Communications which is a buy as well. We have seen huge cash buying along with a good VWAP long roll which is happening in the stock. So, Rs 419 is where we reckon buying that, Rs 415 is the stop loss and target close to Rs 426-428 is what we are expecting.The Great Diwali Discount!
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First Published on Apr 28, 2016 11:15 am