The Nifty Call: Sell on rallies with stop-loss at 14,460

Yoganand D | Updated on April 20, 2021

Market breadth of Nifty 50 biased towards advances

Nifty 50 April Futures (14,399)

The Sensex and the Nifty 50 started the session with a gap-up open despite weak Asian markets. The Nikkei 225 has tumbled 1.9 per cent to 29,100 and Hang Seng index is hovering flat with a negative bias at 29,105. Both the Sensex and the Nifty 50 had begun to decline from the intraday highs and have given back their intraday gains. Currently, the benchmark indices are hovering flat with a negative bias. However, the market breadth of the Nifty 50 is biased towards advances. The India VIX has fallen 0.7 per cent to 22.3 levels, implying decrease in volatility. The Nifty mid- and small-cap indices have advanced 0.8 per cent and 1.45 per cent respectively. Selling interest is seen in the Nifty IT and FMCG indices that have declined 1.1 per cent and 0.1 per cent respectively. On the other hand, buying interest is witnessed in the Nifty media and pharma indices that have advanced 1.7 per cent and 1.4 per cent respectively.

The Nifty April month contract commenced the session with a gap-up open at 14,502 against the previous close of 14,374 levels. After marking an intraday high at 14,535 the contract began to decline. It has fallen below the key support level of 14,400. The contract has recorded an intraday low at 14,357. The near-term outlook stays bearish as long as the contract trades below 14,460. Traders can make use of intraday rallies to initiate fresh short positions while maintaining a stop-loss at 14,460. A decline below the immediate support level of 14,360 can drag the contract down to 14,320 and then to 14,300. Next supports are at 14,275 and then to 14,250. Key resistance above 14,460 are placed at 14,500 and then 14,535.

Strategy: Contract witnessing selling interest at higher levels. Sell on rallies with a stop-loss at 14,460

Supports: 14,360 and 14,320

Resistances: 14,460 and 14,500

Published on April 20, 2021

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