The weak closing is an extremely bearish sign. And if one were to take a look at the current position of the short-term oscillators, there are great chances that the sensex will continue to remain weak during the first half of the week. In fact, in all probability, the sensex may test its recently formed bottom of 2915 points.

With the short and medium term moving averages remaining in a negative phase, the MACD has also changed its direction. The position of 21-day RSI too is far from impressive. As far as the weekly chart is concerned, the 21-week RSI has broken its recent bottoms. This indicates the strength of the falling momentum. Overall, the market is expected to remain bearish in the early part of theweek.

As such, fresh purchases should be strictly avoided in the early part of the week. And if the sensex declines, strategy to pick up good oversold stocks can be worked out later. As far as individual stocks are concerned, among the specified section, one third are expected to remain bearish. These stocks are: ACC, Andhra Valley, Apollo Tyres, BSES, Castrol, Colgate, Crompton Greaves, Cummins, Dr.Reddy's Laboratories, Excel Industries, Finolex Cable, Global Trust Bank, Infosys, Ingersol Rand, ITC, Larsen & Toubro, NIIT, Oriental Bank of Commerce, Pentafour Software, Pfizer, Philips, Raymond, Satyam Computers, Sesa Goa, SKF Bearings, SBI, Sterlite, Sun Pharma, Tata Tea, Thomas Cook, Tisco and Wartsila NSD.

While the list of weak stocks is quite long, very few stocks feature in the list of positive stock. Grasim, Ashok Leyland, Burrough Wellcome, Exide and ICICI look attractive. However, since the overall market is expected to remain dull in the first half of the week, it would be better if freshpurchases are avoided. In fact, one can wait for the market to slide and then a make an entry in the oversold stocks. For traders, stocks like Excel Industries, Thomas Cook and HDFC Bank look attractive for a short-sell.