The Hindu Business Line : Volatile movement

Monday’s trading activity witnessed volatile movement. The sentiment reading of the tradable counters remains bearish. Bull move on Tuesday is likely to change the sentiment reading in their favour. On the contrary, the current sentiment reading is likely to be strengthened with additional counters.

Nifty futures

The December month contract opened with a bull gap of around 14 points from its previous close. The December month contract moved within a range of around 77 points. The December month contract closed with a loss of around 10 points from its previous close.

The long position in the December month Nifty contract is intact. The long exit and short entry levels are placed quite far away from its last traded price. These levels are unlikely to be triggered during Tuesday’s trading.

Stock futures

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The composition of the top-10 list had no changes. However, the ranking of the top-10 list had minor changes. Reliance Industries and Reliance Capital interchanged their positions. IDBI and NTPC interchanged their positions. Hindalco moved from eighth to last position in the list. Tata Steel and Hindpetro moved one step higher in the list.

Except SBI, ICICI Bank and Hindpetro all other counters in the top-10 list are in downtrend. The uptrend counter Hindpetro is likely to be under threat for Tuesday’s trading. On the other hand, bull move on Tuesday is likely to terminate all the downtrend counters. Buying opportunities are likely to exist in all the downtrend counters. A lone selling opportunity is likely to exist in Hindpetro. The best among the above is likely to be buying in Reliance Energy. This counter is in downtrend. Bull move on Tuesday is likely to reverse the trend in this counter.

Cash segment

The composition and the ranking of the top-10 list had minor changes. Suzlon made its way to top-10 list pushing out ONGC. IDBI and SBI interchanged their positions. The long exit level for GAIL is placed at 451.55. The short exit level for ONGC is placed at 1200.05.

Except ICICI Bank, Infosys, SBI and Suzlon, all other counters in the top-10 list are in downtrend. The uptrend counters SBI and Suzlon are likely to be under threat for Tuesday’s trading. On the other hand, bull move on Tuesday is likely to terminate all the downtrend counters except BHEL. Buying opportunities are likely to exist in Reliance Energy, Reliance Industries, Reliance Capital, SAIL and IDBI. Selling opportunities are likely to exist in SBI and Suzlon. The best among the above is likely to be buying in Reliance Energy. This counter is in downtrend. Bull move on Tuesday is likely to reverse the trend in this counter.

(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.