The Hindu Business Line : Bulls prevail

Bulls prevailed over Monday’s trading activity. The sentiment reading of the tradable counters remains 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

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The January month contract opened with a bear gap of around 94 points from its previous close. However, the bears could not sustain their initial momentum and gave way to bulls. The January month contract moved within a range of around 126 points. The January month contract closed with a gain of around 24 points from its previous close.

The uptrend in the Nifty January month contract reversed during the initial part of Monday’s trading activity. In the later part of the day, the short position is also terminated. The long entry level is placed quite nearer to its last traded price. The short entry level is placed quite far away from its last traded price. Bull move during Tuesday is likely to trigger the long entry level.

Stock Futures

The composition and the ranking of the top-10 list had minor changes. Infosys and Hindalco made their ways to top-10 list pushing out SRF and IDBI. Reliance Energy moved from first to fourth position in the list. Reliance Industries, Reliance Capital and Tata Steel moved one step higher in the list. The long exit level for IDBI is placed at 171.80.

Except Tata Steel, GAIL and Infosys all other counters in the top-10 list are in uptrend. The uptrend counters Reliance Industries, Reliance Capital and Hindalco 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. Buying opportunities are likely to exist in Tata Steel, GAIL and Infosys. Selling opportunities are likely to exist in Reliance Industries, Reliance Capital and Hindalco. The best among the above is likely to be selling in Hindalco. 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. Suzlon made its way to top-10 list pushing out ONGC. Infosys moved from third to fifth position in the list. Reliance Energy moved from fifty to ninth position in the list. GAIL moved from eighth to sixth position in the list. The long exit level for ONGC is placed at 1283.45.

Except SAIL, Infosys, GAIL, Tata Steel and Suzlon all other counters in the top-10 list are in uptrend. The uptrend counters Reliance Industries and Reliance Capital are likely to be under threat for Tuesday’s trading.

On the other hand, bull move on Tuesday is likely to terminate SAIL and GAIL. Buying opportunities are likely to exist in SAIL, GAIL, Tata Steel and Suzlon. Selling opportunities are likely to exist in Reliance Industries, Tata Steel and Reliance Capital. The best is likely to be selling in Tata Steel. 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.