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Nifty 50 February Futures (8,592)
The Nifty futures contract started the session in the red, opening with a downward gap at 8,639 levels. Taking negative cues from Asian stocks which are trading in negative territory, the contract began to extend its decline witnessing selling pressure. Subsequently, the contract breached its immediate key support at the 8,600 level.
The Asian shares Nikkei 225 has plunged 1.7 per cent to 19,041 and Hang Seng index is trading almost flat at 23,360 levels. The market breadth of the Nifty 50 index is biased towards declines.
Traders with a short-term perspective can make use of intra-day rallies to initiate fresh short positions, while maintaining a stop-loss at 8,615. On resumption of the decline, the contract can test supports at 8,580 and then at 8,555 levels. A further slump below 8,555 can pull the contract down to 8,530 and 8,500 levels in the short term. On the other hand, the contract has significant resistances at 8,600 and 8,620 levels.
A strong rally beyond 8,620 can bring on a corrective upmove to 8,640 levels. The index needs to emphatically breach the key resistance at 8,655 to bring back the bullish momentum.
Strategy: Go short on rallies
Supports: 8,580 and 8,555
Resistances: 8,620 and 8,640
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