Firstly, how do you pencil in the move for the index, once again a range bound trading session? Are we into breakout or breakdown of this range soon?
Sneha Seth: If we see the market, it has been consolidating on the higher side. Today finally we have seen Nifty going below 24,600 as well, but the kind of recovery we have seen in last two hours I believe that is interesting and if on the closing basis we continue to hold on to this gains even and we manage to close above this, I would say that would be a positive thing because if you look at the daily chart, Nifty is hovering around the 20 DMA. On the hourly chart as well if we see the counter is around the support zone which is placed around 200-day simple moving average.
So, if today’s move whatever recovery we have seen and if Nifty manages to sustain above 24,650, 24,700, that would be interesting and we may see some buying coming in from here on then. Banking index, interestingly, it has been outperforming, hardly marginally low today, marginally in red but overall I believe a strong move above 55,800 can be expected. So, the overall biasness remains positive for Nifty and Bank Nifty as well. In case of Nifty as well if someone wants to go ahead and take a long position, they can, keeping a strict stop loss of 24,500.
You mentioned how Nifty Bank is really holding out. In fact, the special mention to the PSU pack that is doing well. In fact, even in the last leg of correction it was the PSU banking names that were really holding out and outperforming. So, what do you see on the charts as far as the PSU banking names are concerned? Are they likely to continue with their up move?
Sneha Seth: I think that is very much possible. PSU banks have been doing good. From here on PSU as well as private sector would also contribute. PSU has been in focus in last two sessions I believe and so on the higher side I think that there should be some consolidation in the PSU space but the overall biasness remains positive.
It can be a consolidation or slight profit booking, but the overall chart structure for banking index specifically for PSU and private overall banking space looks good. So, I believe someone who is holding a long position in this space may continue to hold. If someone wants to go ahead and long the counters, there are many individual counters which are having a good risk-reward ratio that can be in focus.
Along with that, select counters within the auto pack and specifically M&M that has been doing well because when we look at the auto sales number, it was just M&M and TVS that did outperform the street estimates. But specifically on M&M, what are you pencilling in?
Sneha Seth: See, M&M has been consolidating. It has given a very strong momentum, after that the counter has been facing a resistance around 3160-3170 zone, however looking at the overall chart structure the support has been shifted higher to say 2950 for now and someone who is holding a long position may continue to hold it keeping a strict stop loss of around 2950 and upside I believe there is a possibility of a counter heading towards 3200-3250 anytime soon. So, the risk-reward ratio is good, chart structure is also good, and the supports have been shifted higher, so that is the positive.
Tell us in this market what are your calls? What are the stocks that you see value in right now? What are your long positions?
Sneha Seth: Today, I have a buy on two counters. First is Federal Bank. This counter is already up by 2% today, has given a very strong up move. There was a resistance I would say around 204, 205 which it has managed to surpass. So, I believe at this point in time the counter has given a breakout and it looks poised for an up move at least towards 212-214. So, I would suggest buying this counter at current levels with a target of 214, stop loss can be maintained around 202.
Apart from this, UPL, this counter as well looks quite good. If you look at the chart structure it has been resuming the uptrend. So, I believe there is a possibility at current levels, also the risk-reward ratio is quite favourable. So, I would suggest going ahead and going long with a strict stop loss of 621 and the target expected will be around 657.
