Rahul Sharma, Director & Head — Technical & Derivatives Research, JM Financial Services, says “there are two sectors which clearly are looking very good and are on our buying list. The first one is chemicals. We feel there is more upside to it given the last two years of underperformance. The second sector which looks good is the IT space. IT has taken a beating over the last few sessions, but we feel another 2-3% down on the IT index and it would again come into the buying zone. These are the two sectors where we are looking to cherry pick and buy stocks on the long side. There is a bit of pharma also coming into play where we are seeing selective buying. So, defensives are the ones to go for.”
It is a day of the weekly options expiry for at least the Nifty now and it seems like it is likely to be a bit more on the positive side because the last two-three days was all about profit booking and consolidation.
Rahul Sharma: We have seen a dip at the beginning of the year and now I think Nifty is ready to propel towards the 22,000 mark.
Now, we strongly feel that there is a strong chance of a sucker's rally coming into play over here, which means that we may be very well towards the end of this mega up move that we have seen in the last couple of months. Now, what that translates into actionable is we can continue to party but stay close to the exit because once the proper correction starts, we could very well see deeper cuts, especially in the mid and smallcap space where we have seen a lot of high magnitude action in the last few weeks.