See 2700-2691 panning out on Nifty: Rajat Bose

Rajat Bose of rajatkbose.com is expecting a minor bit of rally today morning. He said there are chances that based on the G20 and the RBI measures, the market might see some kind of a pullback to around 2,860–2,885. Bose added that there is a possibility of 2700–2691 panning out. He is extremely negative in the very short-term but feels that the year-end will see a pullback rally.

Here is a verbatim transcript of the exclusive interview with Rajat Bose on CNBC-TV18. Also watch the accompanying video.

Q: How would you trade this morning? Are you still going to be biased on the short side or would you venture into any kind of long trades?

A: I am expecting a minor bit of rally this morning and chances are that based on the G20 and the RBI measures, we might see some kind of a pullback to say 2,860–2,885. This range is very crucial for the Nifty on the upside and if it crosses this then maybe we would be looking at 2,935.

I would be wary of carrying this position overnight because I feel that 2,700 or 2,691 is still probable and is likely to pan out even before the settlement closes. But with regard to how the year-end would be, I am actually looking at a good pullback rally late November, early December and so maybe the end of the year would not be that bad.

So, as of now, for the very short-term, I am still negative but at least I am expecting a pullback towards the end of the year.

Q: What is your view on the pocket that corrected the hardest and probably traders would watch out for this morning, that is the infrastructure space, how would you trade stocks like IVRCL and JP Associates now?

A: Chances are that one might see some kind of a pullback today, but both IVRCL and JP Associates’ charts till the end of last week have not been showing anything great. We need to watch out IVRCL trading above Rs 123, that would be a good indicator and that would suggest that it is getting some kind of traction and it may actually move up. However, I might play on the long side for these kinds of stocks today. I would not like to carry them overnight because I feel that the short-term trend will still have to go down, and it would not be worthwhile to carry these positions overnight.

Q: What about the whole universe of metal stocks, they had a pretty bad run last week? What are you seeing on the charts of, especially, the steel stocks?

A: Tata Steel had a very crucial level; Rs 171 to about Rs 165 would be the level to watch out for. If this range is broken then Tata Steel might head for Rs 150 or even lower and medium-term projection for Tata Steel would be much lower. It may head for Rs 125 kind of levels but before that, may be, we will see a good rally on the upside but that may happen somewhere between Rs 150–155 range.

If one looks at the Steel Authority of India Limited (SAIL), similar situation are prevailing out there. Only Bhushan Steel is showing a bit better technical position. But as of now if one has to look at the metal stocks, it would be better to look at them towards the end of this November clearing and may be one will get better prices to go long for.