The Hindu Business Line : Bull onslaught

THE sentiment reading of the tradable counters stands bullish. Bear domination on Wednesday is likely to neutralise the sentiment reading. Otherwise, the prevailing bullish sentiment is likely to be further strengthened.

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Nifty futures recommendation: The March contract opened firmly on Monday and remained so throughout the day. It made an intra-day high of 1851.70 with a low of 1808.65. March contract closed with a gain of 39 points with respect to Friday's close.

Bull domination during the day led to the initiation of the uptrend in the March contract. In the normal course of trading on Wednesday, the initiated long position is likely to continue. The exit and bearish trigger levels for the March contract are placed quite far away.

Stock futures recommendation: The top-10 tradable counters list remains unchanged. The ranking of the list had a minor change. Maruti and State Bank interchanged their positions. Trading activity in Ranbaxy was quite impressive on Monday with more than 1950 trades.

Monday's market action resulted in initiating the uptrend in the recommended counter — Maruti. However, the exit level for the initiated long position is in the danger zone. None of the counters in the list is in the downtrend. Except for Satyam, all the other counters in the list are likely to be safe.

Bears are unlikely to have any opportunity for Wednesday's trading. Buying opportunities are likely to exist in six counters.

The best bet is likely to be the buying in State Bank. Its buy level is placed within two rupees from its closing value. Bull move on Wednesday is likely to trigger this level.

Cash segment: There were no new entries or exits to the top-10 tradable list. The ranking of the list had some changes. Satyam moved to the top slot followed by Tata Steel and Tata Motors. Bulls were successful in triggering the uptrend in the recommended counter — Tata Motors.

Bear domination on Wednesday could be a threat to the uptrend in Maruti, Reliance and Tata Motors. On the other hand, the downtrend in State Bank is likely to be under threat.

Selling opportunities are unlikely to exist for Wednesday's trading. Buying opportunities are likely to exist in M&M, State Bank and Tata Steel.

The best among the above is likely to be M&M. This counter is in the sideways mode and has closed at Rs474.35. Bull pressure on Wednesday is likely to initiate the uptrend in the 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.