Markets

The Nifty Call: Go long on a strong rally above 14,440 levels with a fixed stop-loss

Yoganand D BL Research Bureau | Updated on April 23, 2021

The India VIX has declined 2 per cent to 22.5 levels implying decrease in volatility

The Sensex and the Nifty 50 started the session with a gap-down open and began to recover thereafter.

After entering the positive territory, the indices failed to sustain at higher levels and started to decline again. The Asian markets are mixed; the Nikkei 225 index is down by 0.57 per cent to 29,020 while the Hang Seng index has gained 0.7 per cent to 28,968 levels. The Sensex and the Nifty 50 are fluctuating between positive and negative territory. The market breadth of the Nifty 50 is at breakeven. The India VIX has declined 2 per cent to 22.5 levels implying decrease in volatility.

Both the Nifty mid and small-cap indices have gained 0.8 per cent each. The Nifty PSU Bank and Nifty PVT Bank sectoral indices are the top gainers that have gained 1.2 per cent and 0.7 per cent, respectively. Selling interest is seen in the Nifty Pharma and Realty indices that have fallen 0.79 per cent and 0.7 per cent correspondingly.

The Nifty April month contract started the session with a gap-down open at 14,335. After marking an intra-day low at 14,321 the contract began to trend upwards and recovered from the intra-day low. It recorded an intra-day high at 14,468. The contract tests a key resistance in the band between 14,430 and 14,440. A strong rally above this zone is needed to strengthen the bullish momentum and take the contract higher to 14,465 and then to 14,490 levels.

On the other hand, a move below the immediate support level of 14,370 can pull the contract down to 14,330 and then to 14,300 levels. Traders can go long with a fixed stop-loss only if the contract moves beyond 14,440 levels.

Strategy: Go long on a strong rally above 14,440 levels with a fixed stop-loss

Supports: 14,370 and 14,330

Resistances: 14,440 and 14,465

Published on April 23, 2021

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