The Hindu Business Line : Bear domination

BEARS gained control of Wednesday's trading activity. The sentiment reading of the tradable counters stands bearish. Bull domination on Thursday is likely to change the sentiment reading in their favour. Otherwise, the prevailing bearish sentiment is likely to continue with added strength.

Nifty futures recommendation: The near month May contract opened with a bear gap of five points and made steady losses during the day's trading. Bulls managed to make a partial recovery. The May contract moved within a band of 24 points. It closed with a loss of 6 points over Tuesday's close.

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Bear domination during the day led to the initiation of the downtrend in the May contract. The exit level for the short position is placed quite closer to the current level. Bull move on Thursday has the potential to terminate the downtrend in the May contract. Bullish trigger level for the May contract is placed slightly away from the last traded value.

Stock futures recommendation: The composition of the top-10 tradable counters had a change. MTNL gained entry with the exit of Arvind Mill. The top three traded counters in this segment were Satyam, Tata Steel and Reliance. The uptrend in Arvind Mill, PNB and Union Bank is placed at 122.95, 366.95 and 103.65 respectively.

For Thursday, most of the prevailing counters in the list are likely to be under threat. Selling opportunities are likely to exist in six counters. Buying opportunities are likely to exist in five. The best bet for Thursday's trading is likely to be the selling in MTNL. This counter is in the uptrend. The exit and sell level for this counter is placed closer to the current level. Bear pressure on Thursday has the potential to reverse the prevailing uptrend in MTNL.

Cash segment: There were no new entries or exits to the top-10 active counters list. The ranking of the list had few changes. SAIL moved to the sixth position and ONGC to the ninth position.

Except for ONGC, all the other counters in the list are in the downtrend. Bull pressure on Thursday is likely to terminate most of the downtrend counters in the list. On the other hand, the lone uptrend counter - ONGC is likely to be under threat. Bulls are likely to have the opportunity in as much as eight counters. A lone selling opportunity is likely to exist in ONGC. The best is likely to be the selling in ONGC. The exit and bearish trigger level for this counter is placed quite closer to the last traded price. Bear move on Thursday 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 fund management consultant.

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