Financial Daily from THE HINDU group of publications
Wednesday, Mar 27, 2002

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Markets - Technical Analysis

Bear domination

K. Premkumar

BEARS were in total control of Tuesday's trading activity. Bulls were unable to make any impact during the day's trading. The market sentiment reading of the tradable counters remains bearish. Currently, none of the counters in the list is in the uptrend. Bull domination on Wednesday is likely to neutralise the prevailing sentiment. Otherwise, the prevailing sentiment is likely to continue with a slight change in its value.

Nifty futures recommendation: The near month March contract opened with a bear gap of around 6 points and went further by another 10 points. Bears capitalised the day's entire move leaving the bulls with no opportunity to recover. The March contract closed lower with a bearish note.

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The short position in the March contract remained undisturbed. The exit level for the same is locked up with a decent profit of 15 points. Bullish trigger level for the March contract remains around the same level.

Stock futures recommendation: There were no new entries or exits to the top-10 tradable counters. The ranking of the list had a few changes. BPCL moved to the fourth position followed by Digital and Reliance Industries.

For those holding short positions in Reliance Petro and State Bank, the stop loss is placed at Rs 26.60 and Rs 220.60 respectively.

For Wednesday, the prevailing downtrend in Reliance Industries and Ranbaxy is likely to be under threat. Buying opportunities are likely to exist in BPCL, Hindustan Petro, Ranbaxy and Reliance Industries. Selling opportunities are likely to exist in Digital, Hindustan Petro and MTNL. The best among them for Wednesday's trading is likely to be the selling in Digital. Its sell level is placed quite closer to its last quoted price. Bear move on Wednesday is likely to initiate the downtrend in the counter.

Cash segment: The composition of the top-10 tradable counters in this segment remained intact. The ranking of the list underwent a change. Zee Tele and Infosys interchanged their positions.

Bull domination on Wednesday is likely to terminate the following downtrend counters- Hindustan Petro, Polaris Soft and Reliance Industries. Bears are likely to have opportunity in Aftek Infosys, Digital and VisualSoft. On the other hand, buying opportunities are likely to exist in Hindustan Petro and Reliance Industries. Selling in Digital is likely to be the best bet for Wednesday's trading. Its bearish trigger level is placed very close to its closing price. Bear pressure on Wednesday is likely to initiate the downtrend in the 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 Chennai-based technical analyst and fund management consultant.

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