The Hindu Business Line : Bears prevail

THE sentiment reading of the tradable counters continues to remain neutral. Bear domination on Wednesday is likely to change the sentiment reading in their favour. Otherwise, the sentiment reading is likely to turn bullish.

Nifty futures recommendation: July month contract opened with a bull gap of 7 points and went further by another five points. Later on, bears took charge of the day's proceedings. The July contract moved within a band of 39 points registering an intra-day low of 1513.10. It closed with a loss of 15 points with respect to Monday's close.

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Initial bull move led to the initiation of the uptrend in the July contract. The exit level for the initiated long position is placed quite closer to its current level. Bear domination on Wednesday is likely to terminate the uptrend in the July contract. Bearish trigger level for the July contract is still placed far away.

Stock futures recommendation: The composition of the top-10 tradable list in this segment underwent a change. M&M gained entry with the exit of Infosys. Trading activity in Polaris was quite hectic with more than 2,150 trades. The exit level for the uptrend in Infosys is placed at 1388.10.

None of the counters in the list are in the downtrend. Bear domination on Wednesday could be a threat to the uptrend in CNX IT and Satyam. Bears are likely to have opportunity in as much as eight counters. Buying opportunities are likely to exist in ONGC, Reliance and State Bank. Selling in Reliance is likely to be the best for Wednesday's trading. Bearish trigger level for this counter is placed within four rupees from its closing value. Bear move on Wednesday is likely to initiate a fresh downtrend in Reliance.

Cash segment: There were no new entries or exits to the top-10 tradable list. The ranking of the list underwent a change. ONGC and Tata Power interchanged their positions. Bear domination on Wednesday is likely to terminate the uptrend in Punjab Bank, Satyam and Tata Steel. On the contrary, the downtrend in Reliance is likely to be under threat. Selling opportunities are likely to exist in six counters. Buying opportunities are likely to exist in ONGC, Reliance and State Bank. The best bet is likely to be the selling in Tata Motors. This counter is in the sideways mode and has closed at 405.20. Bear pressure on Wednesday is likely to trigger the downtrend in Tata Motors.

(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.