Nifty 50 August Futures (9,823)
The US markets closed the session on a positive note on Tuesday. The Dow Jones Industrial Average gained 0.9 per cent to close at 21,899 and the S&P 500 advanced 1 per cent on optimism about tax reform.
Moreover, the Asian markets also started on a positive note. The Nifty and Sensex began the session with a gap-up open and continued to hover in positive territory with the initial bullish momentum.
The Nifty futures contract started the session at 9,811, breaching the key resistance level of 9,800. After an initial decline, the contract found support at 9,800 and continued its up-move. The contract has marked an intra-day high of 9,833. The advances/ declines ratio of the Nifty index is biased towards advances.
Traders with a near-term view can consider buying the contract as long as it trades above 9,800, with a fixed stop-loss at 9,790 levels. The contract can extend its rally and test resistance at 9,835 and 9,850 levels. Key supports below 9,800 are placed at 9,780 and 9,760 levels.
Strategy: Buy the contract on dips with a tight stop-loss at 9,790 levels
Supports: 9,800 and 9,780
Resistances: 9,835 and 9,850