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A sharp relief rally helped the markets close the week on a high. The Nifty closed at 4,746 up 122 points, while the Sensex shut shop at 15,761 up 403 points.

Technical Analyst Rahul Mohindar of viratechindia.com is positive on Reliance Energy, Power Grid.

“Every time we have an intra-day bump up, everyone starts talking about whether the bottom has been made. We are still far away from that situation. The markets are slightly going to be sideways to negative. I don’t see it moving into a secular upmove. We need to look at 4,600 broadly and 4,950 on the upper-end. Unless, we get a closing breakout past these levels, we are possibly not heading into any kind of a sizeable trend. Play out the volatility. Try and get in a small way as soon as the market cracks. I don’t see a big bear market coming in the next one or two weeks. Its largely going to stay sideways and its very easy to call the downside. I wouldn’t be short for this month,” said Rahul Mohindar.

Here’s how Rahul Mohindar views the stocks on board:

On Reliance Industries, Reliance Energy and Reliance Communications:
From a long-term perspective, at the current price point Reliance Energy looks fairly attractive. I am not trying to call it a bottom from here. I wont be very uncomfortable from hereon getting long for energy, with an 8-12 month perspective.

For an upmove, Reliance Industries would need to clear out Rs 2,400 or Rs 2,360 on a closing basis. So, we are still close to those levels but not yet through it. That is the stock that can really give some throughput.

In case of Reliance Communications, I would still be a bit apprehensive on the telecom space. I am not very convinced that we have seen some bottoming out formation coming in. So, maybe you are in for another 5-10% of a downslide on several telecom stocks. Only after some consolidation can we see an upmove. So, I am not in a hurry to buy that one.

On DLF and Power Grid:
It is still not yet positive rather than saying that downside looks kind of restrictive but I cannot really call them clear buys at this point. I think it is the inclusion, which is creating this kind of volatility. I think largely the trend for both these counters still remain down but again I would not be a trader who would go fresh short on these. I would possibly like to wait, see them consolidate and breakout but yes I agree that some of those oil & gas stocks look like they are trying to make a move for themselves.

On JP Associates, Punj Lloyd and Ranbaxy:
If I am going to be buying into DLF or a JP Associates, I do not see any breakout in these stocks. I would possibly call this an upmove, which even may be corrective in nature. I am not going to be jumping into these stocks. You may see some unwinding coming in another 3-4% higher up.

But if you are looking at this market from a longer-term perspective, Power Grid is a stock you want to start nibbling into. But none of these fresh inclusions catch my eye to go long, especially from that trading perspective considering the fact they would be highly aggressive in the short-term.

On ITC:
The stock never really broke its major trend in the longer-term. At every lower level, you are going to see some kind of a bounce or buying coming in. So, I would look at the stock only on a correction. It’s a relatively safe stock to get in. This is one of those counters where getting a 30-35% with a one-year perspective shouldn’t be a big deal. So, I would like to buy ITC on a correction.

Disclosure: It is safe to assume that I personally do not hold any of the stocks. However, I may have recommended some of them to my clients.

Source: Moneycontrol.com