Financial Daily from THE HINDU group of publications
Thursday, Feb 19, 2004
THE sentiment reading of the tradable counters continues to remain bullish. Bear dominance on Thursday is likely to turn the sentiment reading in favour of bears. Otherwise, the prevailing bullish sentiment is likely to continue with added strength.
Nifty futures recommendation: February month contract moved within a close band for the second successive trading day. Initially it gained 14 points and thereafter steadily lost its ground. The February contract registered an intra-day low of 1916.55 before closing at 1918.00. It closed with a loss of 6 points.
Initial move led to the initiation of the uptrend in the February contract. However, this is likely to be under threat for Thursday. Bearish trigger level for the February contract has also been moved closer to its last traded value. Bear domination on Thursday is likely to reverse the uptrend in the February contract.
Stock futures recommendation: There were no new entries or exits to the top-10 tradable list. The ranking of the list had a minor change. Reliance and Tata Power interchanged their positions.
Bulls were successful in initiating the uptrend in the recommended counter State Bank. The exit level for the initiated position is placed in the danger zone. Most of the counters in the list are in the uptrend. Bear domination on Thursday could be a threat to the prevailing uptrend counters. On the other hand, the downtrend in ACC is likely to be terminated.
Bears are likely to have opportunity in Reliance, State Bank, Tata Motors and Tata Power. A lone buying opportunity is likely to exist in ACC.
The best among these is likely to be State Bank. This counter is in the uptrend and has closed at 630.00. The exit and bearish trigger levels are placed closer to this level. Bear move on Thursday has the potential to reverse the uptrend in this counter.
Cash segment: The composition of the top-10 tradable list remains intact. The ranking of the list underwent a change. Tata Steel moved to the top slot followed by Satyam.
Wednesday's market action resulted in initiating the downtrend in Satyam. Bear move on Thursday is likely to terminate the uptrend in Reliance, SAIL, State Bank and Tata Motors. On the contrary, the downtrend in Infosys is likely to be terminated. Selling opportunities are likely to exist in six counters.
Buying opportunities are likely to exist in two counters. The best bet is likely to be the selling in ACC. This counter is in the sideways mode. Its sell level is placed very close to its current level. Bear pressure on Thursday is likely to trigger the downtrend in this 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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