The Hindu Business Line : Marginal gains

THE sentiment reading of the tradable counters stands bullish. Bear domination on Wednesday is likely to change the sentiment reading in their favour. Otherwise, the prevailing sentiment is likely to be further strengthened.

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Nifty futures recommendation: During the initial hour of Tuesday's trading the February contract lost around 11 points. Bears failed to capitalise on it as they yielded to bull pressure. The February contract registered a high of 1931.70 after making a low of 1903.00. It closed with a gain of 10 points with respect to previous close.

Initial bear move led to the termination of the uptrend in the February contract. However, the re-entry level is placed closer to its last traded value. Bull pressure on Wednesday is likely to re-instate the uptrend in February contract. Bearish trigger level for the February contract is placed slightly away from its current level.

Stock futures recommendation: The composition of the list of top-10 tradable counters remains intact. Reliance, Tata Steel and Maruti were the top three traded counters in this segment.

Tuesday's market action triggered the uptrend in the recommended counter, ACC. The exit level for the long position is in the danger zone. None of the counters in the list are in the downtrend. Except for Maruti and Tata Steel, all the other counters in the list are likely to be under threat. Traders are left with ample opportunities for Wednesday's trading. Seven opportunities are likely to exist on the short side and four on the long side. The best bet for Wednesday's trading is likely to be the buying in State Bank. This counter is in the sideways mode and has closed at 635.35. Bull move on Wednesday is likely to trigger the uptrend in this counter.

Cash segment: There were no new entries or exits to the top-10 tradable list. The ranking of the list too remains unchanged. Bulls failed to initiate the uptrend in the recommended counter, Infosys.

Bear domination on Wednesday is likely to terminate the uptrend in ACC and Tata Motors. On the other hand, the lone downtrend counter, GAIL is likely to be under threat. Bulls are likely to have opportunity in four counters. Selling opportunities are likely to exist in six counters. Buying in Satyam is likely to be the best for Wednesday's trading. This counter is in the sideways mode. Its bullish trigger level is placed within two rupees from its last traded value. Bull pressure on Wednesday is likely to initiate the uptrend 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.