The Hindu Business Line : Bear domination

THE sentiment reading of the tradable counters continues to remain bearish with no downtrend counters. Bull domination on Friday has the potential to neutralise the sentiment reading. Otherwise, the prevailing bearish sentiment is likely to be further strengthened.

Nifty futures recommendation: During the open, the February contract gained 39 points. Bulls failed to capitalise on it as they yielded to bear pressure. February contract made an intra-day low of 1765.35 after making a high of 1821.70. It closed with a loss of 16 points with respect to Wednesday's close.

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The short position in the February contract expired. This position is likely to be closed at 1765.80. This leaves the trade with a substantial profit of 137 points. Fresh entry levels are given for the March contract. Bearish trigger level is placed very close to its last traded value. Bear pressure on Friday is likely to trigger this level.

Stock futures recommendation: There were no new entries or exits to the top-10 tradable list. Reliance, Tata Steel and Tata Motors were the top three traded counters in this segment. Thursday's market action resulted in initiating the downtrend in M&M. The initiated short position is likely to continue on Friday.

The positions in the expired February contact will be automatically closed with the underlying cash market closing values. Except for M&M, all the other counters in the list are in the sideways mode. Entry levels for all the counters are given for the March contract. Bears are likely to have ample opportunities for Friday's trading. A lone buying opportunity is likely to exist in Maruti. Selling in Tata Power is likely to be the best bet for Friday's trading. This counter has closed at 351.00. Bear pressure on Friday is likely to initiate the downtrend in this counter.

Cash segment: The composition as well as the ranking of the top-10 tradable list remains unchanged. Thursday's market had no impact on the recommended counter-State Bank.

Except for Maruti, all the other counters in the list are in the downtrend. Traders are left with a lone opportunity for Friday's trading. This is likely to exist on the long side of Maruti. This counter is in the sideways mode. Its bullish trigger level is placed closer to its current level.

Bull move on Friday has the potential to initiate a fresh 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.