The Hindu Business Line : Bears prevail

BEARS exerted pressure over the initial hours of Friday's trading activity. The day's market action resulted in triggering the downtrend in few tradable counters. The sentiment reading of the tradable counters stands mildly bearish. Bull domination on Monday has the potential to change the sentiment reading in their favour. Otherwise, the prevailing bearish sentiment is likely to be further strengthened.

Nifty futures recommendation: The near month May contract opened two points lower than the previous close and went further down by another 10 points. Later on, bulls gained control of the day's proceedings and wiped out their losses. The May month contract moved within a band of 29 points registering a high of 1993.00. It closed with a gain of 11 points over Thursday's close.

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Friday's market action triggered the uptrend in the May contract. The exit and bearish trigger level for the May contract are placed at the same level. These levels are placed slightly away from the current level. In the normal course of trading on Monday, these levels are unlikely to be triggered.

Stock futures recommendation: The composition as well as the ranking of the top-10 tradable counters in the list remains unchanged. State Bank, Tata Steel and Reliance were the top three traded counters in this segment. The exit level for the short position in Bank of India is placed at 97.40.

For Monday, most of the counters in the list are likely to be under threat. Bulls are likely to have opportunity in as much as eight counters. Selling opportunities are likely to exist in three counters. Buying in Satyam is likely to be the best for Monday's trading. Bullish trigger level for this counter is placed quite closer to the current level. Bull move on Monday is likely to initiate a fresh uptrend in Satyam.

Cash segment: There were no new entries or exits to the top-10 active counters list. The ranking of the list underwent a change with Infosys moving to the top slot. Bears were successful in triggering the downtrend in the recommended counter-Tata Motors.

Bull domination on Monday is likely to terminate most of the downtrend counters in the list. On the contrary, the uptrend in Infosys, Oriental Bank and Wipro are likely to be under threat. Buying opportunities are likely to exist in six counters. Selling opportunities are likely to exist in four counters. For Monday, the best bet is likely to be the buying in State Bank. This counter is in the sideways mode. Buy level for this counter is placed within two rupees from the last traded price. Bull pressure on Monday is likely to trigger the uptrend in State Bank.

(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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