Firstly, to understand this bounce back that we are seeing in trade today, do you expect that to sustain?
Sudeep Shah: In the last few sessions, what has happened is that a lot of times Nifty has opened gap up and then we have seen the entire gap being sold into. But today, for the first time in the last two to three hours, we have seen intermediate bounce of volatility, but by and large, this zone of 23,450, 23,480 has held and every dip to that zone has been bought into.And one more positive factor, which I am just trying to see is that banking today has stabilised above its 10-day exponential moving average which is around 50,800, 50,820 and apart from that, IT is also supportive and plus Reliance also has at least stopped its fall.
All this put together, along with the few pointers which you just mentioned, which Ansh just mentioned that the open interest has come down by 2% in Nifty futures.
So, I feel, yes, for the next few sessions we could expect a relief rally going and we could eye levels of 23,850, 23,950 thereabouts and on the downside now 23,500, 23,450 zone would offer strong support. And I guess it is not too that you have said that it could be the first week where we could close in green. So, I feel that yes, we could see a strong closing today and it could be closer to 23,650, 23,700 and we could consolidate on these gains for the next three hours.
As you were speaking, we are just about to touch 23,650, so do you expect that to be a hurdle or that could be passed very easily by the benchmark?
Sudeep Shah: The kind of flows, the kind of momentum that we are witnessing in a lot of largecap stocks today, I feel that this could cross, if not today, then on Monday.See ultimately after a bounce back from the lower levels closer to 23,650 there could be some profit booking or something like 50, 70, 80 points and that we have seen throughout the day, there have been bouts of selling pressure of 40, 60, 80 points and once again immediately in the next five-minute candle, the entire selling pressure has been bought into.
So, I feel overall now, let us stick with that support zone of 23,500 until this zone holds, this upside could continue up to 23,800, 23,900 zone in the coming few sessions.
But sectorally speaking, there is quite a bit of strength today in select PSU banking names and real estate names. Give me your top recommendations from these two baskets.
Sudeep Shah: If you closely observe both yesterday’s fall in the PSU basket, a lot of these stocks recovered yesterday itself and within the PSU basket if I have to pick up any stock, then it would be Bank of Baroda because the kind of support zone from where it bounced back yesterday.
220, 223 zone was an important Fibonacci number as well as this stock is now once again back above 230, 228 levels which for us was an important support as this was important price point in the last four months.
So, from the PSU banking if one stock has to be mentioned, then it has to be Bank of Baroda and it might not be an easy one-sided move on the upside, V-shaped recovery, but slowly and steadily we could see this stock heading back up to 250, 255 levels and this could be added in a staggered manner with 225 as a stop loss on the downside. And from the real estate pack, if you have to pick up any stock, then it would be Godrej Properties.
Post this fall from 3300, 3400 in the last one-and-a-half months, the stock has retested an important support zone closer to 2550, 2600 and once again today with this move of 3.5%, a lot of short covering is witnessed here and the stock is once again attempting to cross and sustain above its 200-day moving average which is closer to 2770 odd zone.
So, I feel that along with this move, it is also crossing its 20-day exponential moving average which is hinting at some kind of a trend change on the upside. So, till 2760 holds on Godrej Properties, I feel that this up move could continue up to 2880, 2920 in the coming few sessions.