The Hindu Business Line : Bear domination

The sentiment reading of the tradeable counters stands mildly bearish. Bull domination on Wednesday is likely to change the sentiment reading in their favour. Otherwise, the prevailing bearish sentiment is likely to be further strengthened.

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Nifty futures recommendation: The February month contract opened one point lower than its previous close and made steady losses during the initial hours of Tuesday's trading. Later on, bulls made a strong come back and wiped out their losses. The February contract moved within a band of 24 points. It closed with a gain of six points above previous close.

The uptrend in the February contract remains intact. The exit and bearish trigger levels for the February contract are still placed far away. The long position is unlikely to be disturbed on Wednesday.

Stock futures recommendation: The composition of the top-10 tradeable list underwent a change. Gujarat Ambuja Cement gained entry with the exit of NTPC. The ranking of the list had some changes. Infosys moved to the third position followed by ACC and State Bank. The exit level for the uptrend in NTPC is placed at Rs 85.45.

Most of the counters in the list are in the sideways mode. Bull move on Wednesday is likely to terminate the prevailing downtrend counters in the list. On the contrary, the uptrend in Reliance and State Bank are likely to be under threat. Bears are likely to have opportunity in five counters. Buying opportunities are likely to exist in as much as eight counters.

The best bet is likely to be the selling in Gujarat Ambuja Cement. Sell level for this counter is placed closer to its current level. Bear pressure on Wednesday is likely to trigger the downtrend in Gujarat Ambuja Cement.

Cash segment: The composition as well as the ranking of the top-10 tradeable counters remains intact. Tuesday's market action had no impact on the recommended counter-Reliance.

Except for the downtrend in SAIL, all the other counters in the list are likely to be under threat. For Wednesday, six opportunities are likely to exist on either side of trading. The best is likely to be the selling in Tata Steel.

This counter is in the sideways mode. Bearish trigger level for this counter is placed quite closer to its current level. Bear move on Wednesday has the potential to initiate a fresh downtrend in Tata Steel.

(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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