Technical Analysis

Nifty 50 January Futures (14,616)

Yoganand D | Updated on January 20, 2021

Buy on dips with a fixed stop-loss at 14,580

BL Research Bureau

The domestic equity indices - the Sensex and the Nifty 50 started the session on a positive note, amid mixed Asian markets. The Nikkei 225 is down by 0.38 per cent to 28,523 while the Hang Seng index has climbed 0.97 per cent to 29,930 levels in today's session. Both the Sensex and the Nifty 50 have climbed 0.5 per cent and 0.6 per cent respectively. The market breadth of the Nifty 50 is biased towards advances.

On the other hand, the volatility index - India VIX has slumped 3.6 per cent to 22 indicating decrease in choppiness. The Nifty mid and small-cap indices have advanced 0.68 per cent each so far. The top sectoral gainers are Nifty Auto and IT that have jumped 2.1 per cent and 1.9 per cent respectively. Minor selling interest is seen in the Nifty FMCG, Financial Service sector indices.

The January month Nifty 50 futures contract started the session on a positive note, opening at 14,581. After marking an intraday low at 14,524 the contract continued to trend upwards breaking a key resistance at 14,600 and marked an intraday high at 14,634. The near-term stance stays positive as long as the contract trades above the key base level of 14,580. Traders can buy on declines with a fixed stop-loss at 14,580. A decisive rally above 14,635 can take the contract higher to 14,650 and then to 14,675 levels. Key supports below 14,580 are placed at 14,550 and 14,525 levels.

Strategy: Buy on dips with a fixed stop-loss at 14,580

Supports: 14,580 and 14,550

Resistances: 14,635 and 14,650

Published on January 20, 2021

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