Financial Daily from THE HINDU group of publications
Tuesday, Apr 09, 2002

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Markets - Technical Analysis

Narrow movement

K. Premkumar

MONDAY'S trading witnessed narrow movement. Bears were successful in reducing the bull count by a considerable margin. The market sentiment reading of tradable counters stands neutral. Bear domination on Tuesday is likely to change the sentiment reading in favour of the bears. Otherwise, the prevailing sentiment is likely to continue with a slight change in its value.

Nifty futures recommendation: The April contract opened with a bull gap of 2 points but failed to make any further gains. Thereafter, bears were in control of the day's proceedings. The April contract closed with a loss of around six points with respect to Friday's close.

Bears were successful in terminating the uptrend in the April contract. The trade exited with a loss of around 9 points. Bearish trigger level for the April contract is now placed just 2 points away from its current level. Bear move on Tuesday is likely to trigger this level.

Stock futures recommendation: The composition and the ranking of the top-10 tradable counters remained intact. The top three traded counters in this segment were Satyam Computer, Infosys and Digital.

All the uptrend counters in the tradable list are likely to be under threat from the bears. The lone downtrend counter — BPCL — is likely to be safe. Buying opportunities are likely to exist in MTNL, Reliance Industries and Reliance Petro. Selling opportunities are likely to exist in Digital, Infosys, Reliance Industries, Satyam Computer and Tata Engg. The best among the above is likely to be the selling in Satyam Computer. Its sell level is placed very close to its last quoted price. Bear pressure is likely to initiate the downtrend in the counter.

Cash segment: Reliance Industries regained entry to the top-10 tradable list with the exit of Hindustan Petro. The ranking of the list had a few changes. VisualSoft moved to the third position and Wipro to the seventh position.

For Tuesday, the uptrend in Digital and the downtrend in Zee Tele are likely to be under threat. Traders holding positions in the above two counters will have to be cautious. Bears are likely to have opportunity in Infosys, Reliance Industries and Satyam Computer. On the other hand, buying opportunities are likely to exist in Reliance Industries and Zee Tele. Selling in Satyam Computer is likely to be the best for Tuesday's trading. Its bearish trigger level is placed closer to its last traded price. Bear move on Tuesday is likely to initiate the downtrend in this counter.

(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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