Nifty may see a fresh breakout above 5370: Anil Manghnani

Wed, Aug 08, 2012 at 09:37

Like this story, share it with millions of investors on M3Nifty may see a fresh breakout above 5370: Anil ManghnaniAnil Manghnani, Modern Shares & Stock Brokers says, the Nifty has crossed the first important level at 5,300. "Now, a very important trend line is coming up at 5,370. If that gets taken out then it will be a fresh breakout," he adds.  .   Share  .  Email  .  Print  .  A+A- The Nifty has been on a strong wicket over the last couple of days. In an interview to CNBC-TV18, Anil Manghnani, Modern Shares & Stock Brokers says, the Nifty has crossed the first important level at 5,300. "Now, a very important trend line is coming up at 5,370. If that gets taken out then it will be a fresh breakout," he adds.

Also read: Nifty may go to 5600, if global momentum continues, says Udayan

Below is the edited transcript of his interview with Udayan Mukherjee and Sonia Shenoy.

Q: What is your view on the Nifty?

A: It has crossed the first important level at 5,300. We had a gap down couple of weeks back. That has been filled up. Now, a very important trend line is coming up at 5,370. If you connect the 6,300 top to the 5,630 top of January-February, it comes exactly at 5,370. So, if that gets taken out then it will be a sort of fresh breakout because that will be like a two-year trendline being taken out. So, it will be very significant, if we can close above 5,370 because that means a fresh breakout.

The one disappointment is lack of momentum. When I mean momentum, I mean participation across the board. If you compare 5,348 about a month back and if you look at midcap and smallcap stocks, they have still not completely recovered from the damage that happened on the last three days of July expiry where a lot of these midcaps fell 20-25% at a time. So, the midcap index is also reflecting the same, it’s about 3-4% lower than what it was last month at 5,348. So, maybe momentum and participation is not there. But if it closes above 5,370 you, will have to consider it as a fresh breakout on the Nifty.

Q: A very interesting stock that you have picked from the broader market is PVR, could you tell us about that?

A: It is an odd one. But I am hoping that if the market does close above 5,370 then even midcaps and momentum should start to pick up again. Although it is an illiquid stock, four-five days back it made a major move with huge breakouts in volumes. It has gone a little sideways. But whoever bought that four-five days ago will come back. So, Rs 169-170 could be a stop and a move back to Rs 195-203 is possible.

Q: What is your gut feeling is the Nifty going to cross over into a fresh breakout or do you think it might falter at this crucial juncture?

A: I hope it does, but the one thing that worries me is momentum. The pace at which it has bounced back form 5,050 levels has caught a lot of people on the back foot. When we were closing expiry in July, there was massive selling and it was a lowest point we had been in July. So, a lot of longs were unwinding, there were no shorts in the system. So, a lot of pain was seen on the last three days that it became difficult jus to come back and buy right again on a breakout the next day.

So, many people may have missed out on the rally. That is why the momentum is not picking up. I wouldn’t mind buying above 5,370, but I think I will keep an eye for a false breakout because of the lack of momentum. So, I wouldn’t ignore the 5,370, if it were to breakout. But I will be a little sceptical because of momentum.

document.write(page_mob_footer); function postquote(keysearch) { len = keysearch.companyname.value.length; if(len 10) { tempvar=companyname; flag1="true"; break; } else { j=i+1; result= companyname.charAt(i); preval=companyname.charAt(j); if(result==" " || preval==" " || result=="." || preval=="." || len=0; i--) revstr+=str.charAt(i) return revstr; } function tabs_news_rhs(a) { if(a==1) { document.getElementById("news_mp").style.display="block"; document.getElementById("news_ep").style.display="none"; document.getElementById("rhs_tab_1").className = "act"; document.getElementById("rhs_tab_2").className = ""; } else { document.getElementById("news_mp").style.display="none"; document.getElementById("news_ep").style.display="block"; document.getElementById("rhs_tab_1").className = ""; document.getElementById("rhs_tab_2").className = "act"; } }

From DJ EU Officials Spain Aid Cap Of 100 Bn Euros 'should Be Enough'

The latest earning numbers FIRST on CNBC-TV18

View the original article here

Nifty to end above 5250, take long positions: Sukhani

The trade is that at 5,250 a close above that tells us that this market momentum has turned to up. A close below 5,200 would have told us the opposite. Sudarshan Sukhani

s2analytics.com

Technical analyst Sudarshan Sukhani of s2analytics.com expects Nifty to close above 5,250 today, so he suggests taking some long positions from the start of trade today.

Nifty's close above this level would be indicative of a bullish pattern and an upside trend, he added.

Below is the edited transcript of Sukhani’s interview with CNBC-TV18.

Q: What's the outlook on the Nifty this morning?

A: The outlook was a little muddied last week when we said that you buy calls and buy puts, the market could go anywhere. The important point was that it will go somewhere. If somebody has followed that advice and taken only intraday trades in the direction then today we should be owning some calls and some puts, which are likely to lose value.

But the trade is that at 5,250 a close above that tells us that this market momentum has turned to up. A close below 5,200 would have told us the opposite. That below close hasn’t happened. Chances are that we might well close above 5,250 today. If that happens then we should be long. The trend is then on the upside. It will also confirm a mildly bullish pattern.

So, we have to take this a day at a time. Since we have to go with the trend, the trend is expected to change to up today on a close above 5,250. Some long positions should be taken from the start of the day.

Q: Does chart of Divis Labs also look good?

A: The charts look fantastic. Divi’s Lab has been making new highs and then consistently doing it, not just going up and then eventually retracing. So, here is a chart and here is a stock that says ‘I am willing to go up and the market is willing to support that rally.’

There is a lot more buying here. Today, there will be a gap open of some kind. But then on intraday dips, on intraday rests it is a buying opportunity. It is not likely to stop where it opens.

Q: Which stock would you buy from the banking space?

A: I have been favouring ICICI Bank and in all fairness it has rallied the best in the large cap banks. That remains a favourite. On Friday it closed lower. The chances are that that was some kind of a correction that’s coming to an end. Today it should close higher, open higher.

At the open after the first cooling off period of 15-20 minutes or later in the day, the stock becomes a buying opportunity. The chances are that it will cross Rs 1,000 and go up. If the Nifty moves up, ICICI will outperform.

Q: What about Bata ? Do you think the pull back post result is over?

A: Bata made those new highs which it has been doing on Friday. That was when the markets were a little confused. Those new highs also confirmed a bullish pattern, some kind of a continuation of the uptrend and that gives a target of Rs 1,050 now. That’s fairly ambitious, that’s 15% up. But Bata has been doing the right things. Bata is now still on a roll and there is much more upside.

Q: You have a buy on Jain Irrigation this morning?

A: If this market is going up and it could well be, so we are just following the momentum. If it doesn’t go up we’ll have to suffer that setback. But if it is going up then midcap stocks are going to go with it and certainly probably outperform.

Jain Irrigation has completed its bear market. It made a double bottom, rallied, then it went through a very sever and sharp correction after the rally. That’s good news because we can buy it lower.

So, around Rs 75 where it stands now, Jain Irrigation has completed a correction and it is probably going to resume its uptrend. This could be a significant up move. So it is not just a day trade. If the trade goes in our favour, we should carry it on.

Q: You have a sell on Reliance Power ?

A: It is a miserable chart. It shows nothing. It keeps on rallying, the rallies are small, they are very intermittent. Even in terms of time the rallies are not sustained and keep on falling.

The reason why I still have sell is that assuming that the market will open up, there will be some opportunities of selling in that strength and Reliance Power is almost the perfect opportunity.

So, once the stock stalls, it is possible to take a short position even as the broad market goes up.

Q: You also have a sell on BPCL ?

A: That’s a very disappointing chart. It had a straight line decline, didn’t stop at all. And now after that decline it is on the verge of a major breakdown on the downside.

Whether that happens or not, the trade again is that if there is a gap up, if there is some strength in the stock, that strength should be used to go short in it.

Q: What would you do with Shree Renuka now?

A: Shree Renuka is a buy. It has been referred to as a buying opportunity earlier also and that holds. So, there are modest smaller short-term targets of Rs 35-36 and an eventual target of Rs 40. That applies to most sugar stocks.

Q: What is the chart of Glenmark telling you?

A: Glenmark is telling us that the bear market in the stock is over. It is now moving up. It has been moving up consistently and it is almost doubled itself. At current levels there is again a buying opportunity. There was a big move on Friday, it is probably a continuation. So, we should expect higher levels to come. Buy on any intraday dip.

Q: What about Dishman Pharma ?

A: Surprisingly Dishman Pharma is also in the same league as Glenmark. Apparently the bear markets in a lot of these midcap pharma companies is done with, it has been making higher highs, higher lows, made a very big gain on Friday. Those gains are going to be built upon.

It does appear that the Nifty is going to close above 5250 for all we know. If that happens, a lot of stocks will move up.

Q: How is the chart of REC ? That looked weak on Friday?

A: Yes it did but I would assume that this is a minor correction in an ongoing uptrend. REC has a very decent chart as does PFC . So Friday’s correction should be bought into. Here is a stock that’s actually corrected. I wouldn’t worry about that dip.

Both these stocks are likely to move up. REC has a very immediate target of Rs 205-210. But eventually I think it will go back to its Rs 250 levels.

Q: Would you buy Marico on dips?

A: No I would not. Marico has seen a very decent rally. At some point Marico becomes a buying opportunity. Fortunately we can't short sell it. I say fortunately because that would be an unwise act. We wait patiently.

Marico for somebody who is a short-term trader is a sell. It should slide further till it finds support somewhere around Rs 180.

Q: How would you approach the opening at 5260? Would you open up a fresh long here?

A: Yes, I would open up a fresh long looking at a target of 5400 and a stop loss at 5200.

Q: What do you think of Mahindra Satyam ?

A: The charts are saying it is going up. So, that’s fine. But I wouldn’t trade in it. There are so many other midcaps available which are more attractive in the IT sector.

View the original article here

Nifty to end above 5250, take long positions: Sukhani

The trade is that at 5,250 a close above that tells us that this market momentum has turned to up. A close below 5,200 would have told us the opposite. Sudarshan Sukhani

s2analytics.com

Technical analyst Sudarshan Sukhani of s2analytics.com expects Nifty to close above 5,250 today, so he suggests taking some long positions from the start of trade today.

Nifty's close above this level would be indicative of a bullish pattern and an upside trend, he added.

Below is the edited transcript of Sukhani’s interview with CNBC-TV18.

Q: What's the outlook on the Nifty this morning?

A: The outlook was a little muddied last week when we said that you buy calls and buy puts, the market could go anywhere. The important point was that it will go somewhere. If somebody has followed that advice and taken only intraday trades in the direction then today we should be owning some calls and some puts, which are likely to lose value.

But the trade is that at 5,250 a close above that tells us that this market momentum has turned to up. A close below 5,200 would have told us the opposite. That below close hasn’t happened. Chances are that we might well close above 5,250 today. If that happens then we should be long. The trend is then on the upside. It will also confirm a mildly bullish pattern.

So, we have to take this a day at a time. Since we have to go with the trend, the trend is expected to change to up today on a close above 5,250. Some long positions should be taken from the start of the day.

Q: Does chart of Divis Labs also look good?

A: The charts look fantastic. Divi’s Lab has been making new highs and then consistently doing it, not just going up and then eventually retracing. So, here is a chart and here is a stock that says ‘I am willing to go up and the market is willing to support that rally.’

There is a lot more buying here. Today, there will be a gap open of some kind. But then on intraday dips, on intraday rests it is a buying opportunity. It is not likely to stop where it opens.

Q: Which stock would you buy from the banking space?

A: I have been favouring ICICI Bank and in all fairness it has rallied the best in the large cap banks. That remains a favourite. On Friday it closed lower. The chances are that that was some kind of a correction that’s coming to an end. Today it should close higher, open higher.

At the open after the first cooling off period of 15-20 minutes or later in the day, the stock becomes a buying opportunity. The chances are that it will cross Rs 1,000 and go up. If the Nifty moves up, ICICI will outperform.

Q: What about Bata ? Do you think the pull back post result is over?

A: Bata made those new highs which it has been doing on Friday. That was when the markets were a little confused. Those new highs also confirmed a bullish pattern, some kind of a continuation of the uptrend and that gives a target of Rs 1,050 now. That’s fairly ambitious, that’s 15% up. But Bata has been doing the right things. Bata is now still on a roll and there is much more upside.

Q: You have a buy on Jain Irrigation this morning?

A: If this market is going up and it could well be, so we are just following the momentum. If it doesn’t go up we’ll have to suffer that setback. But if it is going up then midcap stocks are going to go with it and certainly probably outperform.

Jain Irrigation has completed its bear market. It made a double bottom, rallied, then it went through a very sever and sharp correction after the rally. That’s good news because we can buy it lower.

So, around Rs 75 where it stands now, Jain Irrigation has completed a correction and it is probably going to resume its uptrend. This could be a significant up move. So it is not just a day trade. If the trade goes in our favour, we should carry it on.

Q: You have a sell on Reliance Power ?

A: It is a miserable chart. It shows nothing. It keeps on rallying, the rallies are small, they are very intermittent. Even in terms of time the rallies are not sustained and keep on falling.

The reason why I still have sell is that assuming that the market will open up, there will be some opportunities of selling in that strength and Reliance Power is almost the perfect opportunity.

So, once the stock stalls, it is possible to take a short position even as the broad market goes up.

Q: You also have a sell on BPCL ?

A: That’s a very disappointing chart. It had a straight line decline, didn’t stop at all. And now after that decline it is on the verge of a major breakdown on the downside.

Whether that happens or not, the trade again is that if there is a gap up, if there is some strength in the stock, that strength should be used to go short in it.

Q: What would you do with Shree Renuka now?

A: Shree Renuka is a buy. It has been referred to as a buying opportunity earlier also and that holds. So, there are modest smaller short-term targets of Rs 35-36 and an eventual target of Rs 40. That applies to most sugar stocks.

Q: What is the chart of Glenmark telling you?

A: Glenmark is telling us that the bear market in the stock is over. It is now moving up. It has been moving up consistently and it is almost doubled itself. At current levels there is again a buying opportunity. There was a big move on Friday, it is probably a continuation. So, we should expect higher levels to come. Buy on any intraday dip.

Q: What about Dishman Pharma ?

A: Surprisingly Dishman Pharma is also in the same league as Glenmark. Apparently the bear markets in a lot of these midcap pharma companies is done with, it has been making higher highs, higher lows, made a very big gain on Friday. Those gains are going to be built upon.

It does appear that the Nifty is going to close above 5250 for all we know. If that happens, a lot of stocks will move up.

Q: How is the chart of REC ? That looked weak on Friday?

A: Yes it did but I would assume that this is a minor correction in an ongoing uptrend. REC has a very decent chart as does PFC . So Friday’s correction should be bought into. Here is a stock that’s actually corrected. I wouldn’t worry about that dip.

Both these stocks are likely to move up. REC has a very immediate target of Rs 205-210. But eventually I think it will go back to its Rs 250 levels.

Q: Would you buy Marico on dips?

A: No I would not. Marico has seen a very decent rally. At some point Marico becomes a buying opportunity. Fortunately we can't short sell it. I say fortunately because that would be an unwise act. We wait patiently.

Marico for somebody who is a short-term trader is a sell. It should slide further till it finds support somewhere around Rs 180.

Q: How would you approach the opening at 5260? Would you open up a fresh long here?

A: Yes, I would open up a fresh long looking at a target of 5400 and a stop loss at 5200.

Q: What do you think of Mahindra Satyam ?

A: The charts are saying it is going up. So, that’s fine. But I wouldn’t trade in it. There are so many other midcaps available which are more attractive in the IT sector.

View the original article here