Avoid IT, better to focus on PSUs as that remains a strong sector: Rohit Srivastava

economictimes.indiatimes.com:

Rohit Srivastava, Founder, Indiacharts.com, says “I do not think we will dip and fill the gap much. In fact, we may see a continuation of this move higher. You will have to selectively look at where you can come in with fresh trades as more and more stocks start to participate. We have not really seen the entire market participate in this move. Which is why there will be many opportunities in individual names to pick on even though the index may appear to have already moved up a bit, we are probably not done with this move.”

After this gap up opening, should one buy the momentum or should one wait to fill the gap and then look at buying more positions as far as Nifty and Nifty Bank go?
In bullish markets, sometimes the gaps do not get filled, at least not immediately till the next cycle of correction comes in. I am not so sure whether this gap will get filled. I know what happened in the early part of this week, especially over the Diwali weekend as we gapped up on Diwali Day, the firecrackers went off and then the next day, a lot of the gains were given back.

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But just because that happened the first time, we should not expect it would happen every time. The fact is that the market still has huge short positioning even as of yesterday. The net short held by FIIs was around 1,47,000 contracts on the index futures and they have actually not really covered much of the short position. So, there is a lot of bearish sentiment out there which was created because of this US