The Hindu Business Line : Bull domination

Bulls dominated over Monday’s trading activity. The sentiment reading of the tradable counters changed to bullish. Bear 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 January month contract opened with a bull gap of around 29 points from its previous close. The January month contract moved within a range of around 56 points. The January month contract closed with a gain of around 37 points from its previous close.

Bull move during the day reversed the downtrend in the January month Nifty contract. 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 and ranking of the top-10 list had minor changes. VSNL made its way to the top 10 list pushing out SBI. Reliance Capital and Reliance Energy interchanged their positions. MTNL moved from eighth to sixth position in the list. ICICI Bank and NTPC moved one step lower in the list. IDBI moved one step higher in the list. The short exit level for SBI is placed at 2428.05.

All the counters in the top-10 list are in uptrend. Except Reliance Energy, Tata Steel, MTNL and NTPC all other counters in the top-10 list are likely to be under threat for Tuesday’s trading. There are no buying opportunities for Tuesday’s trading. Selling opportunities are likely to exist in Reliance Capital, Reliance Industries, GAIL, ICICI Bank, IDBI and VSNL. The best among the above is likely to be selling in Reliance Capital. This counter is in uptrend. Bear move on Tuesday is likely to reverse the existing trend in this counter.

Cash segment

The composition and the ranking of the top-10 list had minor changes. VSNL made its way to top-10 list pushing out Tata Power. ICICI Bank and SAIL interchanged their positions. HDFC and Tata Steel interchanged positions.

Except Reliance Industries, ICICI Bank and Infosys all other counters in the top-10 list are in uptrend. The uptrend counters SAIL, Reliance Capital, HDFC and VSNL 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 in the list. Buying opportunities are likely to exist in all the downtrend and sideways counters. Selling opportunities are likely to exist in Reliance Industries, SAIL, Reliance Capital, HDFC and VSNL. The best is likely to be selling in Reliance Industries. This counter is in sideways mode. Bear move on Tuesday is likely to initiate a fresh downtrend 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.