Ashwani Gujral\'s top picks for trade today

Technical analyst Ashwani Gujral is bearish on the prospects of Hindalco, Tata Steel, Bank of India, HDFC Bank and ICICI Bank. He advises traders to sell these stocks.

Here are the key levels to watch out:

Hindalco:

Metals stocks have rallied quite sharply and with the news coming from China, there could be an impact for a couple of days. Hindalco, we could short with a stop of about Rs 212, target here for the day could be Rs 195.

Tata Steel:

Tata Steel had reached a key level of Rs 680-700 where it often finds resistance. From there it started declining. With China?s news, we should sell this with a stop of about Rs 650, target here could be closer to Rs 590.

Bank of India:

Earlier bank stocks used to open down and finally used to close up on the day. These days they open up and close down, which is a sign of stocks losing momentum. We could short Bank of India with a stop of about Rs 540; target here could be Rs 486. This is a short-term bearish call. Medium-term banking still looks positive.

ICICI Bank:

Both these ADRs, HDFC Bank and ICICI Bank were down quite sharply and these stocks have run up so much from those elevated levels that a 10-15% correction is not unlikely. We short ICICI bank with a stop of about Rs 1,145, target here for the day could be Rs 1,080.

HDFC Bank:

At higher levels it?s not been able to cross Rs 2,500. We could short this with a stop of about Rs 2,410; target here over the short run could be Rs 2,230.

Below is a verbatim transcript of his interview on CNBC-TV18. Also watch the accompanying videos for more.

Q: What is the support zone that you are watching out for on the Nifty and how much can we get pegged back by?

A: Day before yesterday, we tried to pullback from the lows of 5,980 but that pullback failed before reaching the top end of the range. That indicated that selling pressure still continues.

Today below 5,980, we should look at around 5,930- 5,950 but overall we should test the 50 day moving average (DMA) which should be tested every three-four months. So the 50 DMA is about 5,750-5,800. That seems to be the first target and I think all rallies should now terminate at about 6,120 which was yesterday?s high.

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