2 days Ago
"So, on the downside, then we will again look at retesting 23,200, the lows that we made last month and if that breaks, then possibly go towards 22,800 is what we are looking at on the Nifty," says Rohit Srivastava , Founder, Strike Money Analytics & Indiacharts. Help us with your take on the benchmark indices, seems like a decent start to the calendar year 2025. So, where do you see the markets headed because of late the markets have been under pressure and people are highlighting that the trend is actually downwards, but help us with your take on the benchmark indices.
Rohit Srivastava: So, I do think the trend is down and this is typically a period where you see very little volatility because of New Year's today, most markets being closed. Having said that, we have bounced off to the next critical resistance in the short term, which is at around 23,780. So, unless that level is really surpassed, the upside may be capped over there.
If we do cross that, then there will be a possibility of going back above 24,000. But my bias would be towards that not happening, possibly the move down would resume from here and you see selling pressure build up again. So, on the downside, then we will again look at retesting 23,200, the lows that we made last month and if that breaks, then possibly go towards 22,800 is what we are looking at on the Nifty.
But within the auto pack, is there any stock which is a bit of an outlier and showing strength or would you recommend just staying away from the sector right now? Rohit Srivastava: We are still staying away from the sector. The only sector that is showing any kind of strength over the last 10 days or so has been pharmaceuticals, that has outperformed in a much clearer way and so it might remain that way as a lot of funds that are coming out of other places go into the defensive pharma sector, so that is the only place. Autos have been weak.
I do not see any reason why they should suddenly become much stronger. There is no clear sign that is happening. So, possibly you are going to continue making lower lows and lower highs in the auto stocks as well.
But in the last calendar year and especially in the second half we have seen that the FMCG names have been under pressure. So, any stock that is showing signs of reversal here or do you still believe that stocks like Dabur, Marico, HUL can continue to be under pressure? Rohit Srivastava: Yes, so usually, when we speak of defensive, I spoke of pharma and the second thing we would think about is why not FMCG? But for some reason, maybe because of the high valuation backdrop, the selling pressure this time in FMCG stocks has been far more intense than what we have seen in many-many years and that is the reason why it is not coming into our picture, even though we can say technically that some of these stocks over here are oversold, some of them are showing positive divergence, this is for a pickup but we are not getting the follow through and that is why it is not coming up on our list, so that is just how it is. It remains one of the weak segments still.
I do not know if it will pick up in the face of even further selling pressure or will it decline with the rest of the market because the market itself does not look ready for a big move up. The question is, can FMCG play the same role that pharma does? Not very sure really. Stock Trading Masterclass on Value Investing and Company Valuation By - The Economic Times, Get Certified By India's Top Business News Brand View Program Stock Trading Market 104: Options Trading: Kickstart Your F&O Adventure By - Saketh R, Founder- QuickAlpha, Full Time Options Trader View Program Stock Trading Technical Analysis for Everyone - Technical Analysis Course By - Abhijit Paul, Technical Research Head, Fund Manager- ICICI Securities View Program Stock Trading Stock Markets Made Easy By - elearnmarkets, Financial Education by StockEdge View Program Stock Trading Renko Chart Patterns Made Easy By - Kaushik Akiwatkar, Derivative Trader and Investor View Program Stock Trading Market 101: An Insight into Trendlines and Momentum By - Rohit Srivastava, Founder- Indiacharts.
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Till the 16th of December, it was making new highs. But what we have seen till yesterday is a break of its trend line from the entire 2024 period, I think from June if we just take a trend line of the June bottom to the November bottom, that actually broke two days ago and we are still watching that because it is trying to bounce back. And if it does not really get back above, say, 43,400, that is the Nifty IT index, then we are looking at further downside on the IT sector.
This would also coincide with what we are seeing as a renewed selling in US tech stocks because the Nasdaq has actually been down for the last couple of days and that would also continue to push the IT sector lower. So, not really willing to take immediate bets on IT sector even though the result season is right ahead. We would stay cautious here as well.
Any sector you believe that could be in for some more correction and where fresh trade can be initiated because all in all, what we are getting to understand is that you are not very positive on the markets and feel like that the correction could be more within the benchmark indices as well as select sectors can continue to be under pressure. So, any sector that you believe that still has some more scope of getting into that downward move? Rohit Srivastava: Yes, it is showing up in metals. The consistently rising dollar is pushing down commodity prices.
Yesterday, we have seen a new low in copper prices as well. So, the metal stocks will continue to face the heat, so that is one sector which still has a lot more downside to go. Within PSU stocks also we are not completely done because there has been a lot of rotation.
Some PSU stocks probably have fallen a lot more, but there are others which are just starting to decline and therefore, even PSU stocks might give up further gains in the days ahead. (You can now subscribe to our ETMarkets WhatsApp channel ).
