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K. Premkumar

Tuesday’s trading activity witnessed volatile movement. However, the sentiment reading of the tradable counters continues to remain bearish.

Bull domination on Wednesday is likely to neutralise the sentiment reading. On the contrary, the current sentiment is likely to be further strengthened with additional counters.

The February month contract opened with a bull gap of around 37 points from its previous close. However, they were not able to sustain their initial momentum and gave way to bears.

After tug of war between bulls and bears during the day’s trading ultimately the bears gained control towards the end of the day’s trading. The February month contract moved within a range of around 155 points. The February month contract closed with a loss of around 27 points from its previous close.

The short position in the February month Nifty contract is intact.

The short exit and long entry levels are placed quite far away from its last traded price. These levels are unlikely to be triggered during Wednesday’s trading activity.

The composition and the ranking of the top-10 list had no changes. All the counters in the top-10 list are in downtrend. SBI is the lone counter which is likely to be under threat for Wednesday’s trading.

A lone buying opportunity is likely to exist in SBI. Bull domination on Wednesday is likely to reverse the existing trend in this counter.

The composition and the ranking of the list remain unchanged. The uptrend counters Reliance Industries, SAIL and Infosys are likely to be under threat for Wednesday’s trading. On the other hand, downtrend in ICICI Bank is likely to be terminated. Buying opportunities are likely to exist in ICICI Bank and SBI.

Selling opportunities are likely to exist in Reliance Industries, SAIL, SBI and Infosys. The best among the above is likely to be selling in Infosys. This counter is in uptrend. Bear move on Wednesday is likely to reverse the prevailing 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.

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