Nifty 50 September Futures (11,472)

The Indian equity benchmarks are trading flat since morning. Both the Nifty 50 spot and the Sensex spot indices are now hovering around yesterday’s closing level. Among the major Asian indices, the Nikkei 225 ended the day with nearly 0.5 per cent gain whereas the Hang Seng index is down by 0.3 per cent so far.

The advance-decline ratio of the Nifty 50 index is at 27-23 i.e. 27 out of the 50 stocks in the indices are in the green. Though it can be considered as a positive sign, the market breadth is not significantly in favour of the bulls. More stocks need to gain for the rally to be broader.

Despite the benchmark indices being flat, the mid-cap and the small-cap indices have gained 0.2 to 1.2 per cent.

Among the sectoral indices, the Nifty media index is the top gainer, up by 1.9 per cent whereas the Nifty PSU bank index is the top loser, down by 1.7 per cent. Notably, the volatility has gone up i.e. the volatility index – India VIX – is up by just over 1 per cent to 22.

The September futures of the Nifty 50 index opened today’s session slightly lower at 11,480 against yesterday’s close of 11,510. Since then, the contract has been moving in a sideways trend between 11,450 and 11,530. Unless either of these levels are breached the next swing in price will remain uncertain. Until then, traders can stay on the sidelines.

A decisive rally above 11,530 can lift the contract to 11,575 and possibly to 11,615. But if it slips below the support at 11,450, it can decline to 11,400. Subsequently it can dip to 11,360.

Strategy: Stay on the sidelines as the contract is sluggish

Supports: 11,450 and 11,400

Resistances: 11,575 and 11,615