The Hindu Business Line : Bear onslaught

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

Nifty Futures recommendation: The June contract opened three points above its previous close and went further by another five points. The bulls failed to capitalise on it, succumbing to bear pressure. The contract moved within a band of 42 points, registering an intra-day low of 1443.25. It closed lower on a strong bearish note.

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The short position in the June contract remained intact. Thursday being the last day for the contract, the bullish entry level has been given for it and is placed far away from its last traded value. The short position in the June may be held with the stop-loss order placed at 1484.95. If the stop is not hit, allow the contract to expire.

Stock Futures recommendation: There were no entries to or exits from the top-10 tradable list. The ranking of the list underwent a minor change, with Maruti and Reliance interchanging positions. Trading activity in M&M was impressive on Wednesday, with more than 5,300 trades.

None of the counters in the list is in the uptrend. Except for ONGC, all the other counters in the list are likely to be safe. Bears are likely to have opportunity in CNX IT, Satyam and Tata Steel. Buying opportunities are likely to exist in CNX IT and M&M.

The best among the above is likely to be the selling in Tata Steel, whose sell level has been placed closer to its current level. A bear move on Thursday may trigger the downtrend in this counter.

Cash segment: The composition of the top-10 tradable list in this segment underwent a change. M&M gained entry with the exit of Punjab Bank. Reliance moved to the fifth position, followed by Tata Motors.

Except for the uptrend in Infosys and the downtrend in ONGC, all the other counters in the list are likely to be safe. Buying opportunities are unlikely to exist for Thursday's trading. Selling opportunities are likely in Infosys, Satyam and Tata Steel. The best bet for Thursday's trading may be Infosys, which is in the uptrend. The exit and bearish trigger levels for this counter are placed closer to its last traded price. Bear pressure on Thursday is likely to reverse the prevailing uptrend in Infosys.

(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 technical analyst and fund management consultant.