The Hindu Business Line : Bear domination

BEARS were in control of Tuesday's trading activity. The sentiment reading of the tradable counters stands mildly in favour of the bears. Bull domination on Wednesday is likely to change the sentiment reading to bullish. Otherwise, the prevailing bearish sentiment is likely to be further strengthened.

Nifty futures recommendation: The March month contract opened around its previous close and thereafter lost steadily during the day's trading.

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The March contract moved within a band of 26 points registering an intra-day high of 2139.00. It closed with a loss of around 17 points with respect to previous close.

The sideways trend in the March contract remains intact. Bearish trigger level for the March contract is placed quite closer to the current level. Bear move on Wednesday has the potential to initiate a fresh downtrend in March contract. Bullish trigger level for the March contract is placed quite far away.

Stock futures recommendation: The composition of the top-10 tradable list remains unchanged. Bank of India and Satyam interchanged their positions. Trading activity in Jet Airways was quite impressive on Tuesday with more than 14,000 trades.

Most of the counters in the list are likely to be under threat. Bears are likely to have opportunity in four counters. Buying opportunities are likely to exist in six counters. Selling in Satyam is likely to be the best bet for Wednesday's trading. Bearish trigger level for this counter is placed closer to the current level. Bear pressure on Wednesday is likely to initiate a fresh downtrend in Satyam.

Cash segment: The top-10 tradable counters list underwent a change. Bank of India gained entry with the exit of Infosys. The ranking of the list remains the same with no major changes. The downtrend in Infosys is likely to terminate at 2241.05.

Bull pressure on Wednesday is likely to terminate the downtrend in Satyam and State Bank. On the other hand, the lone uptrend counter — Andhra Bank is likely to be under threat. Selling opportunities are likely to exist in three counters. Buying opportunities are likely to exist in six counters. For Wednesday, the best is likely to be the selling in Reliance. Bear move on Wednesday is likely to trigger the downtrend in Reliance.

(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.

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