The Hindu Business Line : Bear domination

BEARS gained control of Wednesday's trading activity. Their dominance left the bulls with no opportunity to recover. However, the sentiment reading of the tradable counters stands bullish. Bear domination on Thursday is likely to change the sentiment reading in its favour.

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Nifty futures recommendation: The near month January contract initially gained 10 points. Thereafter bears took command of the day's proceedings. The January contract moved within a band of 76 points. It closed with a loss of 37 points with respect to previous close.

Bear domination during the day led to the termination of the uptrend in the January contract. The long trade exited with a loss of around 23 points.

Fresh entry levels are given for the February contract. Bear domination on Thursday has the potential to initiate the downtrend in the February contract.

Stock futures recommendation: The top-10 tradable list in this segment underwent a change. M&M gained entry with the exit of ACC. The ranking of the list remains the same with no major changes. Reliance continues to dominate the trading activity in this segment followed by Satyam and Tata Steel.

The long position in ACC is likely to be terminated at Rs 254.55.

Except for the uptrend in Tata Motors, all the counters in the list are likely to be under threat. Thursday being the expiry day for the January contract, entry levels for all the counters are given for the February contract. Bulls are unlikely to have any opportunity for Thursday's trading. Selling opportunities are likely to exist in four counters.

The best bet is likely to be State Bank. The counter is in the uptrend. Its exit and bearish trigger levels are placed closer to its current level. Bear pressure on Thursday is likely to trigger these levels.

Cash segment: There were no entries or exits to the top-10 tradable list. The ranking of the list had some changes. Reliance moved to the fourth position followed by State Bank and Tata Motors.

Bear domination on Thursday is likely to terminate most of the prevailing uptrend counters in the list. Buying opportunities are unlikely to exist for Thursday's trading. Selling opportunities are likely to exist in ONGC, SAIL and State Bank.

The best among the above is likely to be ONGC. The counter is in the sideways mode. Its sell level is placed closer to its last traded price. Bear move on Thursday 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.