The Hindu Business Line : Bear domination

Bull domination on Monday is likely to reduce the bear count by a considerable margin thereby resulting in a change in the sentiment reading. Otherwise, the prevailing bearish sentiment is likely to continue with a slight change in the value.

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Nifty futures recommendation: The near month June contract opened two points above the previous close and went up by another 15 points. Later on, bears made a strong comeback and gained control of the proceedings. The June contract moved within a band of 34 points registering an intra-day low of 2065.30. It closed with a loss of eight points with respect to Thursday's close.

The proceedings in the later part of the day led to the reversal of the uptrend initiated during the initial hour of Friday's trading. The long trade exited with a loss of around 21 points. In the normal course of trading on Monday, the initiated short position is likely to be left undisturbed.

Stock futures recommendation: The composition as well as the ranking of the top-10 active counters list remain unchanged. The top three traded counters in this segment were Reliance, Tata Steel and State Bank. Bears were successful in triggering the downtrend in the recommended counter Tata Motors.

For Monday, most of the counters in the list are likely to be under threat. Bears are likely to have an opportunity in five counters. Buying opportunities are likely to exist in six counters.

Selling in State Bank is likely to be the best for Monday's trading. Bearish trigger level for this counter is placed closer to the last traded price. Bear pressure on Monday is likely to initiate a fresh downtrend in State Bank.

Cash segment: The composition of the top-10 tradable list underwent a change. Hindustan Lever gained entry with the exit of Ranbaxy. The ranking of the list had a few changes.

Infosys moved to the top slot and Maruti moved down to the last position.

Except for the downtrend in Tata Motors, all the other counters in the list are likely to be under threat.

Selling opportunities are likely to exist in four counters. Buying opportunities are likely to exist in three counters.

The best bet for Monday's trading is likely to be the selling in SAIL.

This counter is in the uptrend. The exit and sell levels for this counter are placed quite closer to the current level. Bear move on Monday has potential to reverse the prevailing uptrend in SAIL.

(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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