E Mathew of Mathew Easow Fiscal Services said it's a strongly trending downward market. There is so much panic being created in the market, he said. He sees support for the Nifty at 3,700.
Excerpts from CNBC-TV18’s exclusive interview with E Mathew:
Q: Where do you think the Nifty is going next all supports are coming and going very fast?
A: It is a strongly trending downward market and I think lot of people and I have seen on your channel also following fundamentals have now only started talking technicals and it is becoming a self fulfilling prophecy. There is so much panic being created, when we give the levels, obviously the next support level is around- you have minor support around 3,700.
Q: You were saying that 3,700 is a minor support for the Nifty?
A: 3,700-3,750 is a minor support but 3,600 and the whole world seems to know about it - everyone has started talking technicals but people are ignoring one very fundamental aspect of technicals - that no doubt; we are in extremely oversold zone and we can continue to remain oversold.
The fact of the matter is this situation cannot continue for too long and you have moved so far away from some short-term averages like 13-day moving average, which is at round about 4,320. I think a pullback to these levels is imminent. Now whether it happens this week or after two-weeks, it is bound to happen. A classic example yesterday was the way Cairn Energy collapsed. That shows that there is a absolute capitulation among the market. So I guess the level which everyone is now watching out for with bated breath is 3,600 and I guess that if further panic would set in if 3,600 is broken but I think that it is time for people to cut the short positions if not go long at least and that is what is clearly evident from the charts.
Q: If we do get that technical bounce which we have all been discussing how much would you give it on the Nifty where could it take it upto?
A: Very short-term, I think 4,050-4,100 - but we have moved so far away from some very short-term moving averages like the 13-day moving average which is poised at around 4,320. I think once the market bottoms out and may be the bottoming out process may happen only by next week and we may see some more pain. But once it bottoms out, a pull back to 4,320 is very much possible. But for the very near-term, I think you have got resistances at around 4,050-4,100 zone. So for the very short-term, I think that is the sort of pull back target, which one could look at.
Q: Just as an intra-day trading call would you have opened up a short in this bounce back that you have seen this morning?
A: No, I would not open a short at this particular point of time. There is the possibility in the very short-term also of the Nifty possibly going up to around 4,050-4,100 zone; maybe one could review the position there and see how the Nifty behaves and if weakness is detected at that point, maybe one could think of going short on a very short-term basis. At this particular point of time it is very choppy out there. At best, I think one should stay out of the market. If one does not want to go long, certainly this choppiness and the result in downward drift should be utilized for cutting short positions rather.
E Mathew Disclosure:
During the course of interview, I may be discussing stocks in which my associate company/my clients/I may have trading positions
No comments:
Post a Comment