FINDING BUYING OPPORTUNITIES IN MASSIVE SELLING
Sellers were highly active today but in the last 30 minutes, massive buying observed which took Nifty from low of 9803.55 to 9878. Volumes suggests last hour spike can be sustainable and can be considered Short covering. Even FIIs data suggests, FIIs bought net index Futures and Stock Futures, which actually happened in last 30 minutes. With such panic selling, one may consider to take short positions, but for traders who always look for buying opportunities in the market or value buying might be either panic or might be thinking to value buy in such market. My personal suggestion to such investor would be to analyze results before jumping in to any decision. One such example is Tata Motors, where many investors considered it as a value buy as it has come near 52 week low, but after going through results, one should understand that profit jump that one can see on their P&L statement is due to one time gain and not due to their regular business. Even Tata Steel sold their holdings in Tata Motors which suggests its not a value buy still.
Now for traders comfortable with long side in FO
1)
Even in today's panic selling, IT sector looked like strongly holding its stand and in that too particularly I expect Tech Mahindra to perform better among its peers. Even open low was same today.
Buy Tech Mahindra
Prev close 404
Target 435
SL 392
2)
Another stock that is beaten down badly due to negative news & came on strong support is ITC. It's on 200MA and showed good strength even in today's massive fall. Risk reward ratio also looks good
Buy ITC
Prev close 273
Target 295
SL 268
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