The Hindu Business Line : Bears prevail

BEARS managed to gain from Tuesday's trading activity. The sentiment reading of the tradable counters stands neutral. The bear move on Wednesday is likely to change the sentiment reading in their favour. On the contrary, the sentiment reading is likely to turn bullish.

Nifty Futures Recommendation: The near month December opened with a bear gap of five points and thereafter, moved up by 15 points. However, bears regained their strength and pulled back to the previous level. The December contract registered an intra-day low of 1983.00 after registering a high of 2005.00. It closed with a marginal gain of two points over Monday's close.

The long position in the December contract remains intact. The exit and bearish trigger levels for the December contract remain unchanged. In the normal course of trading on Wednesday, the long position is likely to continue. The bearish trigger level for the December contract is still placed far away.

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Stock Futures Recommendation: The composition of the top-10 tradable list remains unchanged. Reliance, NTPC and Satyam were the top three traded counters in this segment.

Bear domination on Wednesday could be a threat to the prevailing uptrend counters in the list. On the other hand, the downtrend counters are likely to be terminated. Selling opportunities are likely to exist in three counters. Buying opportunities are likely to exist in five counters. Selling in Tata Motors is likely to be the best bet for Wednesday's trading. This counter is in the uptrend. The exit and sell levels for this counter are placed closer to its last traded value. The bear move on Wednesday has the potential to reverse the prevailing uptrend in Tata Motors.

Cash Segment: There were no new entries or exits to the top-10 active counters list. The ranking of the list too remains unchanged. Tuesday's market action had no impact on the recommended counter — ONGC.

Except for the downtrend in Reliance, all the other counters in the list are likely to be under threat. Bears are likely to have opportunities in three counters. Buying opportunities are likely to exist in five counters. Selling in ONGC is likely to be the best bet for Wednesday's trading. This counter is in the uptrend. Bear domination on Wednesday is likely to reverse the prevailing uptrend in ONGC.

(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 a fund management consultant.