The Hindu Business Line : Bear-run arrested

THE sentiment reading of the tradable counters continues to remain absolutely bearish. Bull domination on Tuesday is likely to neutralise the sentiment reading. Otherwise, the prevailing bearish sentiment is likely to continue with a slight change in its value.

Nifty Futures Recommendation: June contract opened with a bear gap of six points and fell by another 36 points. Later on, bulls made a strong comeback and recouped most of their day's losses. June contract moved within a band of 56 points. It closed with a loss of seven points with respect to Friday's close.

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The short position in the June contract remained undisturbed. The exit level is now placed closer to its last traded value. Bull domination on Tuesday is likely to terminate the downtrend in the June contract. Bullish trigger level for the June contract is placed far away.

Stock Futures Recommendation: The top-10 tradable list in this segment underwent a change. M&M gained entry with the exit of HPCL. ACC and Satyam interchanged their positions. The exit level for the short positions for GAIL, HPCL and ONGC are placed at 159.85, 314.50 and 644.05, respectively.

Bear pressure on Tuesday is likely to terminate the downtrend in CNX IT, M&M, Reliance and Satyam. Entry levels for all the counters are placed slightly far away. The nearest entry level is for Satyam. This counter is in the downtrend. Bull domination on Tuesday has the potential to reverse the prevailing trend in Satyam.

Cash Segment: The composition of the top-10 tradable list remains unchanged. The ranking of the list had few changes. State Bank moved to the fourth position followed by ONGC and Tata Motors.

Bull domination on Tuesday could be a threat to five of the ten prevailing downtrend counters. Traders are left with limited opportunities for Tuesday's trading.

Opportunities are likely to exist on the long side of Infosys and Satyam. Between the two, the best is likely to be Satyam. This counter is in the downtrend. Its exit and bullish trigger levels are placed closer to its current level. Bull move on Tuesday is likely to trigger the uptrend in Satyam.

(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.