Nifty 50 September Futures (11,005): Stay on the sidelines and wait for a breakout

Akhil Nallamuthu, BL Research Bureau | Updated on September 13, 2019


Benchmark indices opened the session flat and rallied initially, but it was immediately sold off. The Nifty 50 index is currently trading near an important level of 11,000. While the Asian markets seem to be positive with the Nikkei and Hang Seng gaining 1.1 per cent and 0.6 per cent respectively, the positive sentiment has not been transmitted to the Indian markets which looks sluggish.

Market breadth of Nifty does not indicate any bias as Advance-Decline ratio is almost equally split at 26-24 and the volatility index – India VIX is almost flat at 14.91 levels, up by a meager 0.1 per cent. Nifty Realty index is leading among the sectoral indices with 1.1 per cent gain while Nifty PSU Bank and Nifty Pharma index face selling pressure as both have lost over 1 per cent in today’s session.

The September expiry futures contract doesn’t seem to be trending where it is oscillating between key levels, failing to break the same. It began today’s session at 10,990, below the crucial level of 11,000. In the opening minutes it rallied and made an intraday high of 11,034 but did not sustain and the contract declined to the day’s low at 10,962 level. Crucial support is seen at 10,960 and the next important resistance beyond 11,000 is at 11,040. Hence, unless the contract breaches either 11,040 or 10,960 traders are advised to stay away from initiating fresh positions.

Strategy: Stay on the sidelines and wait for a breakout

Supports: 10,980 and 10,960

Resistances: 11,040 and 11,100

Published on September 13, 2019

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