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Marginal loss

K. Premkumar

THE movement of the index was within a bandwidth of about 22 points on Monday. Towards the close, the index closed with a marginal loss compared to the previous last traded value. The sideways trend in the index initiated on Friday continued. The sentime nt of the tradable list was in favour of the bears with a slight increase in its value.

On Tuesday, a bear move in the market is likely to initiate a fresh downtrend in the index. The sentiment of the tradable list is likely to remain in favour of the bears irrespective of a bull or bear move.

In case of a bear move, it is likely to be further strengthened. Fresh buying for the bulls exists in a lone counter - Tata Steel. Fresh selling for the bears is likely to exist in five counters. The best among the six counters for Tuesday is likely to b e the selling in HCL-Tech.

Index futures recommendation: The April futures contract opened with a bear gap of around 16 points. But the bears were unable to hold, as the April contract closed with a gain of 4 points over Friday's close.

Bear domination on Tuesday has the potential to initiate the downtrend in the target-based style of trading. The prevailing downtrend in the non-target based style of trading is likely to be safe. The exit for the non-target based style of trading and the bullish trigger levels for both the styles of trading are still placed far away.

Scrip recommendation: The top-20 list remains the same with no new entries. The ranking of the list also remains the same with no major changes.

The sentiment of the tradable list continued to be bearish gaining further strength on Monday. It is likely to continue on Tuesday also irrespective of a bull or a bear move. There is likely to be a further increase in its value in case of a bear move.

In case of a bull move on Tuesday, the downtrend in Tata Steel is likely to be under threat. In case of a bear move, the uptrend in L&T, HCL-Tech and ITC is likely to be under threat. Hence, traders holding positions in these counters will have to keep a close watch of their price movement.

Buying opportunity for the bulls is likely to exist in a lone counter - Tata Steel. Selling opportunities for the bears are likely to exist in five counters - Infosys, L&T, HCL-Tech, MTNL and ITC.

Among the above six counters, the best is likely to be the selling in HCL-Tech. This counter is at present in the uptrend.

A bear move on Tuesday is likely to terminate its current trend and trigger its sell level, which is very close to its last traded value.

(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.