Bank Nifty to break below levels of 10,400: Mitesh Thacker

In a chat with ET Now, Mitesh Thacker of miteshthacker.com, shares his views on the market and few sector-specific and individual stocks.Excerpt:

Times Now: What would be your trade on the index and share your stock specific strategies?

Mitesh Thacker: Nifty opened the day with a gap and we have filled the gap on the hourly charts. So the gap up opening has not sustained.

It is important to note that the Monday gap is a big falling gap, and there is no serious attempt by the Nifty to fill that gap. So even if the fact that market remains subdued, the action of the market in the short term is showing that after few days of sideways action or subdued action the drift should be on the downside. Barring a few sectors, say IT and OMCs, which are showing counter trend action, the rest of the pack and particularly banking as well as the realty pack looks negative to me.

The Bank Nifty gives a very weak bounce back and is clearly on the way to break below levels of 10,400. Once that happens it could possibly decline to levels of 10,150-10,100. So we have been trading with the negative bias on banking and realty stocks while positive bias on the OMCs and couple of individual stocks.

At present, I have two buy calls, the first one is BHEL which is clearly showed good price, volume action today. Buy with a stop at 167 for targets of 178. I recommend a buy into IOC which is today breaking above its 200-day moving average with very strong price and volume action. So buy with a stop below 230 for targets of 241.