We could test 18,900 and possibly even 18,400-18,500 by Diwali: Gautam Shah
Gautam Shah, Founder & Chief Strategist, Goldilocks Premium Research, says “we are focussing right now on committing into stocks with quality institutional interest, quality fundamentals, great structural stories, which I do not think will be impacted if the markets were to correct. But on a general basis, on an overall basis, one should be aggressively booking profits in midcaps and smallcaps .”
Shah says: “markets have moved to a risk-off mode and pharma could lead the market move from here in terms of strengths and sectors doing well. We have been a big bull on the entire IT pack for a while now. We maintain that stance. So, these two spaces look great. Auto is considered high beta but it has the potential to be a big structural story for the next 6 to 12 months. Every small dip is a buying opportunity there.”
20,000 may be psychological or it may be technical, but so far, it has acted as a swift or a stiff resistance for the market. Do you think we have a top in place at least in the short term and that could be 20,000?
Yes, I think we had a top in place because all kinds of ingredients were coming in together to suggest that the market did top out at that level of 20,200.
We have always read in the textbooks that when you have madness on the screen and madness on the charts, typically euphoria happens and when euphoria takes place, markets top out.
That was the classic case last month with largecaps, midcaps and smallcaps all running away at the same time with all kinds of talks on the upside. So, 20,200 was definitely a short-term top which might not be taken out in a hurry.
