The Hindu Business Line : Bear domination

Bears prevailed over Thursday's trading activity. However, sentiment reading of the tradable counters turned neutral. Further bear domination on Friday is likely to change the sentiment reading in their favour. On the contrary, it is likely to turn bullish.

Nifty futures

The June contract gapped up by 26 points and further went up by another 20 points. However, bulls could not sustain their initial move and gave way to bear pressure during the later part of the day's trading. June contract moved with in an intra-day range of 215 points. It closed with a loss of around 169 points from yesterday's close.

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Initial bull move terminated the short position in the June contract. Fresh short entry level is placed quite nearer to last traded price. Bear move on Friday is likely to initiate fresh downtrend in June contract.

Stock futures

The composition of the top-10 tradable list had a minor change. Tata Steel gained entry in the place of Satyam Computers. Satyam occupied the last rank in the top-10 tradable list. The top-3 tradable counters in this segment were Reliance, Tata Steel and Infosys.

All the uptrend counters in the list are likely to be under threat for Friday's trading. A lone downtrend counter in the list is likely to be safe during Friday's trading. There are no buying opportunities for Friday's trading. Selling opportunities are likely to exist in nine out of 10 counters in the list. The best bet is likely to be selling in Ranbaxy. This counter is in side ways mode. Bear pressure on Friday is likely to initiate fresh downtrend in this counter.

Cash segment

The composition and ranking of the top-10 tradable list had a minor change. Infosys replaced Reliance Capital in the list. Infosys occupied ninth position in the list of top-10. The short exit level for State Bank is placed at 846.20 and the long exit for Reliance Capital is placed at 525.05.

All the downtrend counters in the list are likely to be safe for Friday's trading. However, uptrend counters are likely to be terminated. There are no buying opportunities for Friday's trading. There are six opportunities on the bear side. The best is likely to be selling in Reliance Industries. This counter is in uptrend. Bear pressure during Friday is likely to reverse the prevailing trend in Reliance Industries.

(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.