10,800 level should act as a short-term immediate support where the NSE Nifty may stabilise, says independent market analyst Kunal Bothra. He spoke to ETNow.
Edited excerpts:
We did touch those levels of 10,866, went below those levels. But we have bounced back and managed to close around 10,930. You gave buy calls as a closing trade. What made you give those buy calls and are you anticipating any bounceback in the Nifty?
One of the indicators which I generally follow is the CMB indicator, that is related to market breadth. It has now entered the extreme oversold territories. So, I believe when you see such sharp reactions on the market breadth, you generally expect that the index should start bouncing now.
And the signs which I discussed in the start of the show as well were positive today (Friday), different from what it was maybe couple of days ago. Because you had largecap names like HDFC Bank, SBI which to a large extent showed resilience.
Even Reliance stayed afloat for quite a bit of time the entire day. So, those positive signs were quite visible in the market and I believe that the index had tested a new low, but bounced back.
10,800 level should act as a short term immediate support and you should see the index stabilising. Over the next couple of days or for the next 3-5 days, the bias should be slightly skewed towards maybe a rally, but on a positional basis as we have been discussing, this market has broken some extremely strong supports on the indicative as well as price front.
It depends on the kind of trader timeframe you are. If you are a very short-term investor — with two days or three days of timeframe — you can play for a bounceback. But as a positional play, you can try and use these rallies to even create short positions as well.
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