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K. Premkumar

INITIAL hours of Tuesday's trading witnessed bull domination. Later on, the bears took over and wiped out the early gains made by the bulls. Bears managed to gain substantially from the day's trading. The sentiment reading of the tradable counters continues to remain neutral. Irrespective of bull or bear domination on Wednesday, the prevailing sentiment reading is likely to continue.

Nifty futures recommendation: During the initial hours of trading, the January contract gained around five points. Later on, the bears came back strongly and wiped out the early gains. The movement in the January contract was around 22 points. It closed with a loss of 11 points with respect to previous close.

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The uptrend in the January contract remained intact. This is likely to be terminated on Wednesday. Since, its exit level is placed just six points below the last traded value. The exit for the long position is placed at break-even level. Bearish trigger level remains unchanged and this is unlikely to be triggered on Wednesday.

Stock futures recommendation: The top-10 tradable counters underwent a change. VSNL gained entry with the exit of Tata Engg. The ranking remained the same with a slight change. The exit level for the uptrend in Tata Engg is placed at Rs 98.50.

The uptrend in ACC and Dr Reddy's Lab is likely to be under threat. So, traders holding positions in the above two counters will have to closely watch their price movements. A lone opportunity is likely to exist for Wednesday's trading. This is likely to exist on the sell side of Reliance Industries. This counter is in the sideways mode. Its bearish trigger level is placed quite closer to its current level. Bear move on Wednesday is likely to initiate a fresh downtrend in this counter.

Cash segment: There were no new entries or exits to the top-10 tradable counters in the cash segment. The ranking of the top-10 list remains undisturbed.

Bear domination on Wednesday is likely to be a threat to the uptrend in HCL Tech and Wipro. Traders are left with a lone opportunity for Wednesday's trading. This is likely to exist on the short side of Wipro. This counter is presently in the uptrend. Its exit and sell trigger levels are placed closer to its last traded price. Bear domination on Wednesday is likely to trigger these levels.

(Note: All price levels refer to the absolute value of the shares traded on the NSE. There is risk of loss in trading.)

The author is a Chennai-based technical analyst and fund management consultant.

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