Nifty Call: Bounce-back possible, wait for fresh rallies next week

Gurumurthy K | Updated on: Nov 26, 2021
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Nifty 50 November Futures (17,206)

It’s a sea of red in the equity markets around the world. The renewed fear of a new Covid-19 variant is weighing on the market sentiment. The Indian benchmark indices are trading sharply lower. Both the Sensex (57,588) and Nifty 50 (17,175) are down over 2 per cent each. Both Sensex and Nifty have crucial supports at 57,000 and 17,000 respectively. It will be important to see if they are getting a bounce from there or not.

All the major Asian indices are also trading in the red today. Nikkei 225 (28,661) and Hang Seng (24,151) are over 2 per cent each. Kospi (2,939) is down 1.30 per cent and Shanghai Composite (3,560) is down 0.65 per cent.

The US markets were closed yesterday on account of Thanksgiving Day.

Futures: The Nifty December Futures (17,206) contract is also down nearly 2 per cent. There is support near 17,100. A low of 17,120 has been made already and the contract is attempting for a bounce. The contract has to break below 17,100 in order to see a further fall. That may not happen today itself. As such, we can expect some recover before the contract breaks 17,100 eventually and extends the fall.

Fresh short positions are not recommended at current levels. Traders will have to wait for further rise from here to short the market again. Or a break below 17,100 is needed enter short positions. Being the final trading day of the week, it is better to stay out of the market rather than getting caught on the wrong side of the market considering the current volatility.

Strategy: Bounce-back possible. Stay out of the market and wait for rallies to take fresh shorts next week.

Supports: 17,100 and 16,750

Resistances: 17,500 and 17,700

Published on November 26, 2021

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