Technical Analysis

Nifty 50 April Futures (9,244)

Yoganand D, BL Research Bureau | Updated on April 24, 2020

Taking negative cues from the global marekts, the Sensex and the Nifty started the session in red with a gap-down open. The Nikkei 225 index has declined 0.86 per cent to 19,262 and Hang Seng index has fallen 0.4 per cent to 23,890 in today's session. After initial decline the Sensex and the Nifty had begun to recover and have cut their respective intra-day loss just 0.5 per cent and 0.6 per cent. The market breadth of the Nifty index is biased towards declines. However, the India VIX is trading flat around 39.3 levels. The Nifty Midcap and Small cap indices have fallen 1.5 per cent and 1 per cent correspondingly. Apart from the nifty Pharma index which has advanced 1.5 per cent all the other sectoral indices are trading in the negative territory. The Nifty realty and Nifty Financial service indices are the top losers that has slumped 3.2 per cent and 2.6 per cent respectively.

The Nifty April month contract commenced the session with a gap-down open at 9,165. After marking an intra-day low at 9,125 the contract began to trend upwards, recovering from the intra-day low. The contract surpassed a key resistance at 9,200 and recorded an intra-day high at 9,260 levels. The Nifty futures contract is trading in discount to the Nifty spot, indicating selling pressure. Traders can initiate fresh short positions on a fall below 9,200 levels with a fixed stop-loss. A contract can continue to trend downwards and test supports at 9,175 and 9,150. A fall below these supports can pull the contract down to 9,125 and 9,100 levels. On the other hand, only a decisive break above 9,300 will bring back positive momentum and take the contract higher to 9,330 and 9,350 levels.

Strategy: Go short on a fall below 9,200 with a fixed stop-loss at 9,220 levels

Supports: 9,200 and 9,175

Resistances: 9,250 and 9,300

Published on April 24, 2020

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