Trading Strategy for August 7, 2000

In the current market conditions, no long positions are recommended in any stock. This is especially important for most new economy stocks, which have broken their major bases and are likely to weaken further. Stocks like Silverline, Digital Equipment, Zee Tele and DSQ Software have been hit badly.

BSE Sensex: As expected, the index is not able to cross its resistance of Rs 4350 which would act as a major resistance in the near future. Software stocks appear far from impressive and it was only Hindustan Lever, which held the index. The next base for the Sensex lies at 4100.

Satyam Computer: The stock has closed below another major support and the fall is likely to continue further. It has an immediate resistance at Rs 2300 and there is a major resistance at Rs 2520. The next support lies only at Rs 1920.

Pentamedia: The stock has broken another major base of Rs 400 and has closed below it. The next support lies only at Rs 356. On the upper side it has an immediate resistance at Rs 405 and another major resistance lies at Rs 430.

Silverline: The stock has made a fresh low after breaking its support level of Rs 330. The fall is likely to continue and the stock does not have any supports in sight. On the upper side, it has an immediate resistance at Rs 320 and thereafter it faces a major resistance at Rs 360.

Wipro: This stock has also broken an important base of Rs 2360 and has closed near its next support of Rs 2100. Further below, it has supports only at Rs 1470 level. On the upper side, it has a major resistance at Rs 2450 and thereafter at Rs 2650.

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