The undertone is yet to show any major signs of weakness, and the position, as mentioned earlier, will improve drastically above 3400 points. Among the IT related counters, Infosys remained range bound, and the trend may continue for the time being. The position will improve above Rs 4200. Satyam Computers also showed a dip but unless the level of Rs 250 is broken, the medium term position will remain firm.
Digital Global also closed in negative territory but the medium term position continues to remain favourable. As for Wipro, the medium term outlook will change only below Rs 1425. HCL Techno was the only major software stock which gained smartly.
The level of Rs 230 is important base for the counter. The first major hurdle for the counter is at around Rs 275.
HFCL, Global Tele, SSI, NIIT and Zee Tele also remained under pressure but the fall is likely to show a slowdown. The second rank counters also remained under pressure due to lack of buying interest. Visualsoft dipped sharply but showed a good recovery from its intra-day low. A sideways to positive move is likely. Polaris and Mastek also closed in negative territory but the medium term position continues to remain favourable. So is the case with Aftek Info.
Among the old economy, HLL showed a firm trend, and further improvement is not ruled out. The level of Rs 210 is an immediate reference point for long positions. Reliance, Bhel, SBI, Bajaj Auto, Telco, Hero Honda, HPCL, BPCL, and Grasim may also do well.
Overall, the market is waiting for some trigger to go up, and one should be ready for a positive move.
(The analyst has long position in Reliance and Digital Global)