Technical Analysis

Nifty 50 December Futures (17,440)

Akhil Nallamuthu | | Updated on: Dec 08, 2021
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Traders can stay on the side-lines now and can initiate fresh shorts when the contract rallies to 17,520

BL Research Bureau

The Asian markets look positive and the major equity indices are trading in the green. Among them, ASX 200 and Nikkei 225 have gained 1.4 per cent each and KOSPI is up by 0.4 per cent. Hang Seng index is flat for the day so far.

Against this backdrop, the Indian benchmarks i.e., the Nifty 50 and the Sensex, at 17,410 and 58,435 respectively, is up by 1.4 per cent each.

The market breadth of the Nifty 50 index is showing a clear bullish bias i.e., the advance-decline ratio is at 46-4. All the mid- and small-cap indices are up, gaining between 1.1 and 1.5 per cent. Moreover, all the sectoral indices are up for the day. The Nifty IT and Realty are the top gainers, up by 1.8 and 1.4 per cent, respectively.

Futures: The December futures of the Nifty 50 began the session with a gap-up at 17,343 versus Tuesday’s close of 17,225. Since then, it has been rallying and the contract is currently hovering around 17,440. From the current level, the futures has strong barriers at 17,520 and 17,585. A rally beyond these levels today is less likely and notably, until the contract stays below 17,650, bears have good chance for a comeback.

Hence, traders can stay on the side-lines now and initiate fresh shorts when the contract rallies to 17,520. Add more shorts if it rises to 17,585 and place stop-loss at 17,625. A reversal from these levels can drag the contract to 17,400. So, exit the shorts at 17,400.

Strategy : Stay out now and short when the contract rallies to 17,520 and 17,585. Place stop-loss at 17,625. Liquidate the shorts at 17,400.

Supports : 17,400 and 17,350

Resistances : 17,520 and 17,585

Published on December 08, 2021

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