The Hindu Business Line : Bear domination

BEARS gained control of Monday's trading activity. The sentiment reading of the tradable counters stands neutral. Bear pressure on Tuesday is likely to change the sentiment reading to bearish. On the contrary, the sentiment reading is likely to turn bullish.

Nifty futures recommendation: The September month contract opened lower with a bear gap of eight points and, thereafter, fell by another 12 points. Bulls managed to make a partial recovery during the close of the day's trading. The September contract moved with in a band of 17 points. It closed with a loss of around nine points with respect to previous close.

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Bear domination during the day led to the termination of the uptrend in the September contract. The long trade exited with a loss of around 60 points. Both bullish and bearish trigger levels for the September contract are placed closer to its current level.

Stock futures recommendation: The composition as well as the ranking of the top-10 tradable list remains unchanged. Tata Steel, Tata Motors and Reliance were the top three traded counters in this segment.

Bear pressure on Tuesday could be a threat to the prevailing uptrend counters.

On the contrary, the prevailing downtrend counters is likely to be terminated. Bears are likely to have opportunity in four counters. Buying opportunities are likely to exist in five counters. Selling in Ranbaxy is likely to be the best for Tuesday's trading. This counter is in the uptrend.

The exit and bearish trigger levels for this counter are placed very close to its closing value. Bear pressure on Tuesday is likely to reverse the prevailing uptrend in this counter.

Cash segment: The composition of the top-10 tradable list underwent a change. Zee Tele gained entry with the exit of Wipro. The ranking of the list had two changes. Satyam moved to the fourth position and ONGC moved down to the tenth position. The downtrend in Wipro is likely to be terminated at 585.05.

Bear move on Tuesday is likely to terminate most of the uptrend counters in the list. On the other hand, the downtrend in Infosys, Reliance, Satyam and State Bank are likely to be under threat. Buying opportunities are likely to exist in six counters. Selling opportunities are likely to exist in five counters. Buying in Infosys is likely to be the best bet for Tuesday's trading.

Bull domination on Tuesday has the potential to 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.