Financial Daily from THE HINDU group of publications
Tuesday, Mar 16, 2004
Bears go on rampage
THE sentiment reading of the tradable counters stand mildly bearish.
Bulls were successful in terminating most of the downtrend counters during the initial move. Further bear pressure on Tuesday is likely to change the sentiment reading as strongly bearish.
Nifty futures recommendation: The March contract opened with a firm note as it gained around 12 points. Later on, bears made an instant recovery and took charge of the day's proceedings. The March contract moved within a wide band of 79 points. It closed lower with a substantial loss of 65 points.
Initial bull move terminated the downtrend in the March contract. The short trade exited with a loss of 25 points. Re-entry level on the downside is placed closer to its last traded value. Bear pressure on Tuesday is likely to re-instate the downtrend in the March contract. Bullish trigger level for the March contract is placed far away.
Stock futures recommendation: The composition as well as the ranking of the top-10 tradable list remains unchanged. The top three traded counters in this segment were Maruti, Satyam and State Bank of India. Monday's market action had no impact on the recommended counter - Maruti.
Most of the counters in the list are in the sideways mode. Except for the uptrend in CNX IT, all the other counters in the list are likely to be under threat. Bulls are unlikely to have any opportunity for Tuesday's trading. Selling opportunities are likely to exist in as much as eight counters.
The best bet is likely to be State Bank of India. This counter has closed at Rs 579.85 and its sell level is placed within a rupee. Bear pressure on Tuesday is likely to trigger the downtrend.
Cash segment: The top-10 tradable counters and their ranking in this segment remain unchanged. Bulls failed to initiate the uptrend in the recommended counter - Maruti.
Bear domination on Tuesday is likely to terminate the lone uptrend counter - Infosys. The prevailing downtrend counters in the list are likely to be safe. For Tuesday, traders are left with opportunities only on the short side. Selling opportunities are likely to exist in six counters. The best is likely to be State Bank of India. This counter is in the sideways mode and has closed at Rs 578.80. Its bearish trigger level is placed closer to this level. Bear move on Tuesday is likely to initiate 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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