The Hindu Business Line : Bull run arrested

Bull run was arrested during Tuesday’s trading activity. The sentiment reading of the tradable counters changed to neutral. Bear move on Wednesday is likely to change the sentiment reading in their favour. On the contrary, bull move is likely to change the sentiment in their favour.

NIFTY FUTURES

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The January contract opened with a bull gap of around 20 points from its previous close. However, bull could not sustain their initial momentum and gave way to bears. The contract moved within a range of around 118 points and closed with a loss of around 19 points from its previous close.

The January contract initiated a fresh uptrend. 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 Wednesday’s trading.

STOCK FUTURES

The composition of the top-10 list had no changes. However, the ranking of the top-10 list had minor changes. Reliance Energy moved from fourth to eighth position in the list. MTNL moved from sixth to fourth position in the list. GAIL and NTPC moved one step higher in the list. Hindalco and Infosys interchanged their positions. The long exit level for IDBI is placed at 178.90.

Reliance Industries, ICICI Bank, NTPC and Reliance Energy are in uptrend in the list. Reliance Capital, Tata Steel, MTNL, GAIL and Hindalco are in downtrend in the list. Except NTPC all other uptrend counters are likely to be under threat for Wednesday’s trading. On the other hand, bull move on Wednesday is likely to terminate GAIL. Buying opportunities are likely to exist in GAIL and Infosys. Selling opportunities are likely to exist in Reliance Industries, ICICI Bank, Reliance Energy and Infosys. The best among the above is likely to be buying in Infosys. This counter is in sideways mode. Bull move on Wednesday is likely to initiate a fresh uptrend in this counter.

CASH SEGMENT

The composition and the ranking of the top-10 list had minor changes. BHEL made its way to top-10 list pushing out Reliance Energy. SAIL moved from third to fifth position in the list. GAIL moved from sixth to third position in the list. Infosys moved from fifth to ninth position in the list. Suzlon moved from last to seventh position in the list. The long exit level for ONGC is placed at 1283.45. The long exit level for Reliance Energy is placed at 2485.30.

Reliance Industries, ICICI Bank, GAIL, HDFC and Suzlon are in uptrend in the list. Tata Steel, Reliance Capital, Infosys and BHEL are in downtrend in the list.

The uptrend counters GAIL and HDFC are likely to be under threat for Wednesday’s trading. On the other hand, bull move on Wednesday is likely to terminate Infosys and BHEL. Buying opportunities are likely to exist in Infosys and BHEL. Selling opportunities are likely to exist in GAIL, HDFC and SAIL.

The best is likely to be selling in HDFC. This counter is in uptrend. Bear move on Wednesday is likely to reverse the existing 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.