What do you make of the market texture? As we were discussing, three-day on the trot we are on the downside. VIX is spiking. What next?
Vinay Rajani: For the last three trading sessions, Nifty has been falling and after registering an all-time high around 22,800, which happens to be the triple top formation. It is a typical textbook resistance with triple top around 22,800. So that has become a strong resistance for now. From the high, we have seen almost a 600-point correction towards 22,200-odd levels. So, definitely, it is a healthy correction. But whatever rise we saw was from the bottom of April 19, which was around 21,777, towards the new all-time high of 22,800. The 61.8% retracement of this entire 1,000-point rally which we saw from the lows of April 19 towards the all-time high which we registered on May 3. The 61.8% retracement for the Nifty comes in at 22,166 and can act as a strong support for the Nifty.
So, overall, the market is in consolidation. There is a range between 22,800 and 22,200. We are passing through the result season and historically, in the result season, the market does not move in one direction. Rather it oscillates in the range. So that is what we are expecting. After falling for the last three trading sessions, I believe that 22,150 to 22,200 should act as a strong support and stock-specific, sector-specific move will be there. The FMCG sector took a lead today and that will definitely continue. So, I am not seeing across-the-board panic selling in the market from here on after the three days correction. 22,150 is a very strong support, which happens to be the 61.8% retracement and with that stop loss one can remain long in the market but we have to select the right stocks. So, overall, FMCG stocks can do well.