Wait & Watch for Reliance Communications: CK Narayan

CK Narayan, Growth Avenues Asset Advisors in a chat with ET Now share his views about the Reliance Communications.

ET Now: What is the call on ADAG pack, Reliance Communications in particular?

CK Narayan: Reliance Communications ever since it reached the low of 71 in August has really not been able to break that bottom in any significant manner. It has actually tested that twice. Maybe just gone briefly below it but then there seems to be a greater willingness to bounce back from 71-72 levels than to really go down and break it.

So if one is holding long or one wishes to create a position in RComm, you should be using these 70-72 level as a stop loss and actually try to go long. If you are holding it, that should again be your stop loss.

The stock trying to put in a base after a very long period of decline would be more suggestive of a stock trying to find its feet rather than something which wants to go down further. So at the moment, I really would not recommend fresh short positions in RComm.

78-71 and all may be good for a day trade or 1 or 2 day trade but from a positional perspective, we should wait and see whether RComm is really successful in trying to re-find its feet with a stop at about Rs 70.