The Hindu Business Line : Bear onslaught

THE sentiment reading of the tradable counters stands bearish. Monday's market action resulted in terminating a few downtrend counters in the list. Bull domination on Tuesday is likely to neutralise the sentiment reading. Otherwise, the prevailing bearish sentiment is likely to be further strengthened.

Nifty futures recommendation: February month contract opened with a weak note and steadily drifted to end up with a substantial loss. The intra-day movement was around 68 points. It closed with a loss of 62 points with respect to Friday's close.

The short position in the February contract remains undisturbed. The position is now locked-up with a decent profit of 33 points. The exit and bullish trigger levels for the February contract are placed far away. These levels are unlikely to be triggered on Tuesday.

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Stock futures recommendation: The top ten tradable counters list remains unchanged. The ranking of the list had a change. Tata Steel and Tata Motors interchanged their positions.

Bulls were successful to the extent of terminating the downtrend in Tata Steel. For Tuesday, the uptrend in M&M and Maruti is likely to be under threat. Buying opportunities are unlikely to exist for Tuesday's trading. Selling opportunities are likely to exist in Maruti, Tata Motors and Tata Steel.

The best among the above is likely to be Tata Motors. The counter is in the sideways mode and has closed at Rs 522. Its sell level is placed within a rupee. Bear move on Tuesday 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 had some changes. Satyam moved to the second position followed by Maruti and Tata Steel. The downtrend in ACC is likely to be terminated at Rs 263.05.

Monday's market action had no impact on the recommended counter — Tata Motors.

Bear move on Tuesday could be a threat to the uptrend in M&M and Maruti. The prevailing downtrend counters in the list are likely to be safe. Bulls are unlikely to have any opportunity for Tuesday's trading. Selling opportunities are likely to exist in four counters.

Selling in GAIL is likely to be the best bet for Tuesday's trading. Its bearish trigger level is placed just fifteen paise away from its closing value. Bear pressure on Tuesday is likely to initiate a fresh downtrend in the 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.