Nifty call: Nifty 50 July Futures (15,850)

Akhil Nallamuthu BL Research Bureau | Updated on June 25, 2021

Tread with caution; supports at 15,800 and 15,750

Equity markets across Asia are bullish today and following this, the domestic benchmarks too have opened with a gap-up open. Among the Asian majors, the Nikkei 225 and the Hang Seng are up by 0.6 and 1.5 per cent, respectively. However, despite the Nifty 50 and the Sensex opening on the strong foot, they lost most of the gain and are now trading higher by 0.2 and 0.1 per cent compared to yesterday’s closing level.

Nevertheless, the advance-decline ratio of the Nifty 50 index is showing positive sign as it stands at 34-16 and the mid- and small-cap indices have gained between 0.5 and 1.6 per cent so far today. Among the sectoral indices, all indices except the Nifty FMCG index (down by nearly 0.5 per cent), are in the green led by the Nifty Metal index, up by 2.7 per cent. This is followed by the Nifty PSU bank index, up by 2.6 per cent.

Futures: Following the underlying Nifty 50 index, the futures contract (July expiry) opened with a gap-up at 15,852 against yesterday’s close of 15,832. It rallied following this and marked an intraday high of 15,874. However, it declined from that level as 15,870 is a considerable hurdle and has lost all the gains and are now flat for the day. The price action indicates that the contract is oscillating between 15,800 and 15,870 and unless either of these levels are breached, the next leg of trend will remain uncertain.

Hence, traders can wait for the contract to move out of this range to initiate fresh trades as the direction of the break can lend us some direction. A breakout of 15,870 can take the contract to 15,915 above which it can touch 15,950. On the other hand, if contract breaches the support at 15,800, it is likely to drop to 15,750 and then possibly to 15,700.

Strategy: Tread with caution

Supports: 15,800 and 15,750

Resistances: 15,870 and 15,915

Published on June 25, 2021

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