Nifty Call: Contract is range-bound; tread with caution

Nifty 50 December Futures (13,940) Taking bullish cues from the global markets, the Sensex and Nifty 50 started the session with a gap-up open. The Dow Jones had gained 0.68 per cent to 30,403 and S&P 500 had advanced 0.87 per cent to 3,735 in the past session. The Nikkei 225 has jumped 2.6 per cent to 27,568 and Hang Seng index has rallied 0.87 per cent to 26,542 levels in today's session. A

fter an initial rally, Sensex and Nifty 50 began to decline on the back of selling interest at higher levels and evaporated the intraday gains. These benchmark indices are now hovering flat, climbing marginally by 0.5 per cent and 0.4 per cent respectively. The market breadth of the Nifty 50 is biased towards declines. The India VIX has gained 3 per cent to 21.0 levels implying increase in volatility. Witnessing selling interest, the Nifty mid and small-cap have marginally hovering in the negative territory. Top sectoral gainers are Nifty PVT Bank and Nifty Bank that have climbed 1 per cent and 0.95 per cent respectively. Nifty media, metal indices have slumped 1 per cent each.

Following a gap-up open at 13,949 the Nifty December month contract recorded an intraday high at 13,965. However, experiencing selling interest at higher levels, the contract trimmed the intraday gains to 0.17 per cent. As long as the contract trades above 13,900 the near term stance stays positive.

A decisive fall below this base level can bring back selling interest and drag the contract down to 13,375 and then to 13,850 levels. Subsequent supports are at 13,830 and 13,800 levels. Resistances are at 13,950 and 13,975. Crical resistance above 13975 is placed at 14,000 levels. As the contract is choppy in the band between 13,900 and 13,950 traders should tread with caution.

Strategy: The contract is range-bound. Tread with caution

Supports: 13,900 and 13,875

Resistances: 13,950 and 13,975

COMMENT NOW