Financial Daily from THE HINDU group of publications
Friday, Nov 21, 2003

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Markets - Technical Analysis

Bear domination

K. Premkumar

BEARS extended their dominance over Thursday's trading activity. Bulls were unable to make any impact for the second successive trading day.

The market sentiment reading of the tradable counters stands bearish with no uptrend counters. Irrespective of bull or bear domination on Friday, the prevailing bearish sentiment is likely to continue with a slight change in its value.

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Nifty Futures Recommendation: During the initial hours of Thursday's trading, the November month contract moved by 16 points. Thereafter bears made a strong comeback and wiped out their early losses. The November contract moved within a band of 43 points. It closed with a loss of 19 points with respect to previous close.

Bear domination during the day led to the initiation of the downtrend in the November contract. In the normal course of trading on Friday, the initiated short position is unlikely to be disturbed. The exit and bearish trigger levels for the November contract are placed at a far away level.

Stock Futures Recommendation: The composition of the top-10 tradable list in this segment remains unchanged. The ranking of the list had some changes. State Bank moved to the sixth position followed by Reliance Industries and Tata Power. Trading activity in G.A. Cement was quite hectic on Thursday with more than 3600 trades.

Bear pressure prevailing in the market has placed the exit levels quite far away for the prevailing downtrend counters in the list. Buying opportunities are unlikely to exist for Friday's trading. Selling opportunities are likely to exist in ACC, CNX IT and Satyam Computer. The best among the above is likely to be ACC. Its bearish trigger level is placed closer to its current level. Bear move on Friday is likely to trigger this level.

Cash Segment: There were no new entries or exits to the top-10 tradable list. The ranking of the list too remains unchanged. The uptrend in Digital is likely to be terminated at 571.50. For Friday, the prevailing downtrend counters in the list are likely to be safe.

Bulls are unlikely to have any opportunity for Friday's trading. Selling opportunities are likely to exist in ACC, Infosys, Satyam Computer and State Bank. The best bet for Friday's trading is likely to be State Bank. Its sell level is placed very close to its last traded price. Bear pressure on Friday is likely to initiate a fresh 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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