Monday 3 November 2008

Metal stocks can rally 10-15%: Bose

Technical Analyst, Rajat K Bose is of the view that metal stocks can rally 10-15% from current levels and Nifty has major resistance around 3,150-3,200 and so he suggests booking profits on those levels and not banking on any further.

Bose told CNBC-TV18, "I would say that these days taking a view of more than 48 hours is risky. Today one will see a gap up opening in all of these stocks. So maybe Sterlite Industries will open something like Rs 295 and it can move up to say Rs 305-310 and Rs 320 would be a major resistance area."

He further added, "Similarly for HIndalco, JSW Steel, Tata Steel they might move up but all these stocks would be executing some sort of relief rallies and so if you are taking a short-term position that is fine but please do not indulge in any kind of long-term buying at these levels thinking that valuations are cheap and this is actually going to be a major rally because the long-term charts either on the stocks, or metals or real estate or banking or even the indices, the long-term charts are suggesting that we are in a multiyear bear market and this is only a relief rally because we have extended too far away from 200 DMA (day moving average) and that is why we are playing a catch up game and once that is through a downtrend will begin."

"My guess is that these metal stocks will not be rallying anything more than 10-15% from current levels and the Nifty has major resistance around 3,150-3,200 and so I would suggest booking profits on those levels and not banking on any further."

Dislcosure: It is safe to assume that analyst and his clients may have an investment interest in the stocks/sectors discussed.

Source: Moneycontrol

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DISCLAIMER: The author is not a registered stockbroker nor a registered advisor and does not give investment advice. His comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to buy or sell a stock, option, future, bond, commodity, index or any other financial instrument at any time. While he believes his statements to be true, they always depend on the reliability of his own credible sources. The author recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction, before making any investment decisions, and that you confirm the facts on your own before making important investment commitments.