Nifty call: Go long with stop-loss at 17,425

Nifty 50 September Futures (17,455)

Despite the Asian markets sending out weak signals, the Indian benchmark indices – the Nifty 50 and the Sensex – have gained for the day so far. The Nifty marked a fresh all-time high of 17,476 and now at 17,455; similarly, the Sensex touched a new high of 58,586 and is currently at 58,505. That is, both are up by about 0.4 per cent each. Among the major Asian indices, the Nikkei 225 lost 0.5 per cent whereas the Hang Seng is down by nearly 1.9 per cent.

The market breadth of the Nifty 50 is indicating a positive bias as the advance-decline ratio stands at 34-16. All the mid- and small-cap indices are in the green, gaining between 0.4 and 1 per cent and barring the Nifty Financial services (down by nearly 0.1 per cent), all other sectoral indices have gained. This indicates broad-based buying. The Nifty PSU bank index is the top performer, up by 1.5 per cent followed by the Nifty IT, up by 1.3 per cent.

Futures: The September futures of the Nifty 50 index began the session slightly higher at 17,405 versus Tuesday’s close of 17,385. Since the beginning of the session, the contract has been gaining and is now trading around 17,455. Notably, it crossed over the prior high of 17,450 and the price action hints at further gain for the day. The intraday trend can remain positive until the futures stays above 17,430 and so, traders can go long with stop-loss at 17,425.

On the upside, the contract can rally and mark a new high at 17,500 above which it can rise to 17,550. On the other hand, if the contract loses momentum and started descending, it can find supports at 17,430 and 17,400. Subsequent support is at 17,370.

Strategy: Go long with stop-loss at 17,425

Supports: 17,430 and 17,400

Resistances: 17,500 and 17,550