Large stocks like TCS, Reliance losing ground; market to drop considerably: Ashwani Gujral

In a chat with ET Now, Ashwani Gujral of ashwanigujral.com, shares his market outlook. Excerpts:

ET Now: What is your market outlook for the current session?

Ashwani Gujral: Everyday, at some point, there is a drop which cannot be created by individual traders selling 50 and 100 shares. It is some sort of basket selling that comes in.

Europe is down -- even that is not showing any follow-through. On the S&P 500, we had a bit of a head and shoulder with a 1,770 kind of a neckline. Yesterday's rally closed exactly at that point.

That CNX IT and Europe is not following through means that the rally on the S&P was a pullback. Hence, global markets could start retreating again post this kind of a pullback. If cement and steel are now going to lead the market to levels of 6,350, then we are not going to cross even 6,100 levels.

In four days, we have laboured along 5- 10 points of sudden drops. This is not the kind of rally that will take us anywhere. I would not be surprised if we drop 100-120 points or gap down because this is setting up for that kind of a scenario.

The stock is getting distributed to weaker hands who are believing that the rally may have started again. Given the way large stocks -- TCS, Reliance -- all of these stocks are dropping and stocks like Tata Steel and India Cements are rallying, this does not give us a good feeling.