The current position of the Sensex is extremely weak and does not call for any fresh purchases at the current level. For the Sensex, the medium term trend has turned negative and a complete change appears very difficult at this juncture. Any rally that occurs, would be met by huge selling at higher levels.

The Sensex drivers like HLL, Reliance, SBI, MTNL and Bhel have turned bearish. The outlook for HLL is negative until it moves above Rs 2,270 level. It has posted a lower top. Reliance too has dipped below the short-term trendline and further fall cannot be ruled out. For SBI, too, the support level is far off. As for Bhel, the stock has entered into a new bear territory and a rally would be of correctivenature. The only pivotal which has potential for a sharp recovery is ITC. The final confirmation of that would come only once it crosses the Rs 973-level. Overall, the Sensex is likely to dip further. Short-sellers can wait to cover their position.

As for Tata counters - Tisco, Telco, Tata Tea and Tata Chemicals - have not shown any sign of strength. Since the major trend is negative for all these stocks, minor rally would witness huge selling pressure. In fact, Tata Chemicals has entered a new bear orbit and the fall from the current level could be very sharp. The only Tata counter which has shown strength is ACC.The stock has remained firm despite overall negative sentiment. Long position can be taken with a stop loss of Rs 1400.

For software stocks, too, the happy days seem to be over. Almost all the software stocks have entered into a negative trend. The outlook for Satyam Computers, Pentafour Software, Rolta, Silverline, Infosys and HCL Infosys is negative. A fall from the current level is expectedon all these counters.

Other stocks where negative trend is like are Apollo Tyres, Arvind Mills, Asian Paints, Bombay Dyeing, Bank of Baroda, Castrol, Cochin Refineries, Corporation Bank, Escorts, GTB, Sesa Goa, Sterlite and Zuari Agro. Stocks like Bombay Dyeing, Arvind Mills, Corporation Bank, Escorts and Sterlite have given fresh sell signals. The only counter where positive trend is expected is Exide Industries. The stock displayed good strength and can remain firm in the coming days.