The Hindu Business Line : Steep fall

THE sentiment reading of the tradable counters stands bearish. Irrespective of bull or bear domination on Friday, the prevailing bearish sentiment is likely to continue with a slight change in its value.

Nifty futures recommendation: During the open, the February contract gained 4 points. Thereafter, bears came with a bang and brought about a steep fall in the February contract. The February contract registered an intra-day low of 1851.15 before closing for the day with 1854.45. It closed with a strong bearish note.

Bear domination led to the reversal of the uptrend in the February contract. The long trade exited with a loss of 16 points. The short position is likely to continue on Friday. The exit and bullish trigger levels for the February contract are placed quite far away.

Click here for table

Stock futures recommendation: There were no new entries or exits to the top-10 tradable list. The ranking of the list had few changes. Tata Steel moved to the top slot and Reliance to the eighth position. Thursday's market action resulted in initiating the downtrend in the recommended counter — State Bank.

Except for the uptrend in Tata Steel, all the other counters in the list are likely to be safe. Most of the counters in the list are in the downtrend. Bear pressure prevailing in the market has placed buy levels for all the counters at a far away level. Traders are left with a lone opportunity in Tata Steel on the sell side. This counter is in the uptrend and has closed at 436.20. Bear move on Friday is likely to trigger the downtrend.

Cash segment: M&M gained entry to the top-10 tradable list with the exit of ACC. The ranking of the list had a total revamp. Tata Motors moved to the top slot followed by Tata Steel and Satyam Computer. The downtrend in ACC is likely to be terminated at 271.05.

Bear domination during the day led to the reversal of the uptrend in ACC. For Friday, the uptrend in GAIL and Tata Steel are likely to be under threat. Traders are left with a lone opportunity for Friday's trading. This is likely to exist on the short side of GAIL. This counter is in the uptrend. Its exit and sell levels are placed within two rupees from its closing value. Bear pressure on Friday has the potential to reverse the prevailing 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.