The Hindu Business Line : Bears prevail

THE sentiment reading of the tradable counters stands bearish. Bull domination on Thursday is likely to neutralise the sentiment reading. Otherwise, the prevailing bearish sentiment is likely to be further strengthened.

Nifty futures recommendation: The March contract moved within a band of 24 points. Bears were in total control of Wednesday's trading activity. The March contract registered an intra-day low of 1832.50 before closing at 1834.80. It closed lower with a strong bearish note.

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Bear domination during the day initiated the downtrend in the March contract. In the normal course of trading on Thursday, the downtrend is likely to continue. However, bull domination has the potential to terminate the downtrend. Bullish trigger level for the March contract is placed quite far away.

Stock futures recommendation: The composition of the top-10 tradable list underwent a change. ONGC gained entry with the exit of ACC. Tata Steel moved to the top slot. The exit level for the downtrend in ACC is placed at Rs 273.55.

Wednesday's market action resulted in triggering the downtrend in the recommended counter — Tata Steel.

Bull domination on Thursday is likely to terminate most of the downtrend counters in the list. On the contrary, the uptrend in ONGC and Tata Power is likely to be under threat. Bears are likely to have opportunity in ONGC and Tata Power. Buying opportunities are likely to exist in CNX-IT and M&M.

The best among the above is likely to be ONGC. This counter is in the uptrend. Its exit and bearish trigger levels are placed within Rs 3 from its closing value. Bear pressure on Thursday is likely to trigger the downtrend in the counter.

Cash segment: The top-10 tradable list in this segment underwent a change. ONGC gained entry with the exit of SAIL. The ranking of the list too had few changes. Tata Steel moved to the second position followed by Maruti and Tata Motors.

The downtrend in SAIL is likely to be terminated at Rs 43.60.Most of the counters in the list are in the downtrend. Except for the downtrend in Satyam Computer all the other counters in the list are likely to be under threat. For Thursday, traders are left with a lone opportunity on either side of trading. This is likely to exist in M&M on the long side and ONGC on the short side.

Between the two, the best bet is likely to be the selling in ONGC. This counter is in the uptrend and has closed at Rs 836.80. Bear domination on Thursday has the potential to the reverse the prevailing trend 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.