Give us a sense on the markets because that 22,600 is what we have broken below in today’s trading session. Pharma is doing well but on the broader markets what is your sense and what is your view coming in right now? Are we in for some bit of recovery from these levels?
Aditya Agarwala: Markets are trying to find its feet. What is interesting is we are not seeing a dramatic fall in the broader markets and the benchmark indices. Snehi did talk about India Vix at the start of the show which is the interesting data to watch at the moment. We are not seeing any spike in the Vix though it opened with a gap, now it is cooled off significantly. So, a cool off in a VIX tells me that there is no panic in the market as such and you can actually have a pullback rally towards the fag end of the trading session and that is what I am looking at and 22,500 is a key support area that I will be eyeing on the Nifty.
Going ahead what is interesting is markets are oscillating in a falling wedge pattern and Nifty today took support at the lower end of the wedge pattern and there it is trying to post a recovery. It will be interesting to see if market actually manages to scale past the resistance levels of 22,650, 22,700.
If that happens towards the fag end of the trading session, market should be fine and it is still trying to form a base after which it will see a good short covering rally. But yes, during that period of time we are seeing volatility and few pockets are correcting. For me the two concern areas are the IT and the bank index. IT is clearly not the flavour at the moment and it is seeing time and again correction because of what is floating around in the news. So, IT is something that is a bit of a concern for me.
So, I will stay away from IT at the moment. All the largecaps, midcaps are correcting. Names like Infosys, TCS, HCL Tech and Coforge they are correcting. So, I will stay away from IT at the moment and bank is something which I think will be the key index if Nifty has to form a base here and go up. So, 48,200 to about 48,000 on the Bank Nifty is something that I am eyeing very closely.
If these levels are held, PSU banks will be the first to see some kind of a short covering rally and from the PSU lot Union Bank, Canara Bank, PNB these will be the ones who will outperform first.
But a little bit more clarity on what your stock specific recommendations would be right now. I can see a sell call coming from you. Help us understand what is the rationale?
Aditya Agarwala: So, yes, I got a sell call on Naukri because it is clearly broken down from key support areas and it is trading below its 200-DMA at the moment. Looks like a fresh short build up is here and that is likely to drag the stock further lower to levels of 6900, that is my target on Naukri. So, I got a sell recommendation on Naukri that is Info Edge for a downside target of 6900 with a stop loss somewhere around 7470. I do like a few pockets especially within the consumer durable space. So, Voltas is one stock that is looking very interesting to me on the chart setup.
So, I got a buy recommendation on Voltas for a target of 1450 on the upside and a stop loss of 1190 on the downside.
Other than the IT space that is definitely reeling under pressure, on the flip side it is a couple of these auto counters as well as FMCG names that are doing decently well in today’s trading session. Any stock from these sectors?
Aditya Agarwala: So, definitely autos and especially within the auto two-wheeler space is something that I will keep a very close eye on. Hero Moto, Bajaj Auto, these are the two stocks which have corrected significantly. It is time to look at them. They offer an excellent risk to reward ratio at current levels. I can add an Eicher Motor to it as well. Let us first talk about Bajaj Auto.
With a good support somewhere around 8200-8300 one can actually initiate fresh long positions in Bajaj Auto, take a positional bet here for a target of 9500 to about 10,000 on the upside.
If I talk about Eicher Motors, that is one stock which is actually buzzing in trade as we spoke. So, on the upside stock can easily test levels of 5200 to about 5400 with a strong support on the downside at 4800. When we talk of four wheelers, I have got two stocks which definitely look very interesting to me.
The first one is Tata Motors, again a stock which has corrected significantly and offers an excellent risk to reward. Again, a positional trade here will be advisable with the support on the downside at 650-661, I would recommend a long recommendation for a target of 800.
And yes, Mahindra & Mahindra definitely stands out because of the new launches and all. Mahindra & Mahindra can also see levels of 3000 on the upside.
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