The Hindu Business Line : Bears prevail

THE initial hours of bear pressure on Thursday changed the sentiment reading to strongly bearish. Bull domination on Friday is likely to neutralise the sentiment reading. Otherwise, the prevailing bearish sentiment may continue.

Nifty futures recommendation: Initially, the near-month August contract lost around 18 points. Later on, the bulls made a strong comeback, wiping out their early losses. The August contract moved within a band of 28 points and closed with a marginal loss of four points.

The short position in the August contract remains intact. The exit level for the short position is now placed at profit zone. Bull domination on Friday has the potential to terminate the downtrend in the contract. The bullish trigger level for it is still placed far away.

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Stock futures recommendation: There were no new entries to or exits from the top-10 tradable list. The ranking of the list changed, with ONGC and Wipro interchanging positions.

Except for the uptrend in Tata Steel and the downtrend in Tata Motors, all the other counters in the list are likely to be under threat. Entry levels for all the tradable counters are placed far away. The nearest entry level is for Maruti. This counter is in the downtrend. Strong bull domination on Friday has the potential to reverse the prevailing downtrend in Maruti.

Cash segment: The most active counters list and their ranking in this segment remain unchanged. The bears were successful in triggering the downtrend in the recommended counter, Satyam.

Except for Tata Steel, all the other counters in the list are in the downtrend. Bull domination on Friday is likely to terminate most of the downtrend counters in the list.

The lone uptrend counter, Tata Steel, may be safe, with the bears unlikely to have any opportunities for Friday's trading. Traders are left with a lone opportunity for Friday's trading. This is likely in Infosys. The exit and bullish trigger levels for this counter are placed closer to its current level. Bull pressure on Friday may reverse the prevailing downtrend 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.