The Hindu Business Line : Bear domination

BEAR dominance on Friday neutralised the sentiment reading. Further bear pressure on Monday is likely to change the sentiment reading to bearish. On the contrary, the sentiment reading is likely to turn bullish.

Nifty futures recommendation: The near month August contract opened with a bear gap of 4 points and went further down by another 30 points.

During the close, bulls made a partial recovery. The August contract closed with a loss of 24 points.

Click here for table

The long position in the August contract survived the bear pressure on Friday. However, this is likely to be under threat for Monday.

Both exit and bearish trigger levels for the August contract are placed quite closer to its current level.

Bear domination on Monday has the potential to reverse the prevailing uptrend in the August contract.

Stock futures recommendation: The composition of the top-10 tradable list underwent a change.

Wipro gained entry with the exit of Maruti. The ranking of the list remains the same with no major changes.

Trading activity in HCL Tech was quite hectic on Friday with more than 1,680 trades.

Except for the uptrend in Wipro and the downtrend in Tata Motors, all the other counters in the list are likely to be under threat. Bears are likely to have opportunity in as much as six counters.

Buying opportunities are likely to exist in three counters. Selling in State Bank is likely to be the best bet for Monday's trading. This counter is in the uptrend. Its exit and sell levels are placed very close to its last traded price.

Bear move on Monday is likely to trigger these levels.

Cash segment: There were no new entries or exits to the tradable list in this segment. The ranking of the list too remains intact.

Bear domination on Monday is likely to terminate the uptrend in Infosys, SAIL and Tata Steel.

On the other hand, the downtrend in ONGC is likely to be under threat. Selling opportunities are likely to exist in six counters.

Buying opportunities are likely to exist in M&M, Reliance and Satyam.

Selling in State Bank is likely to be the best for Monday's trading. This counter has closed at Rs 439.80.

Its bearish trigger level is placed within a rupee from its closing price. Bear pressure on Monday is likely to initiate a fresh downtrend in State Bank.

(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.