Technical Analysis

Nifty 50 July Futures (10,768)

Akhil Nallamuthu | Updated on July 06, 2020 Published on July 06, 2020

Taking positive cues from the bullish Asian markets, the bellwether indices— the Sensex and the Nifty — began the session with a gap-up open and continued to trend upwards. The key indices, the Sensex and the Nifty 50 have advanced 1.4 per cent and 1.8 per cent respectively. The Japan’s benchmark index, Nikkei 225, has advanced 1.8 per cent to 22,714 and Hang Seng index has jumped 3.7 per cent to 26,314 levels so far in today’s session. The market breadth of the Nifty index is biased towards advances. The India VIX has fallen 1.8 per cent to 25.3 levels. The Nifty mid- and small-cap indices have rallied 1.5 per cent and 1.4 per cent respectively. Barring Nifty Pharma index which is down by 0.7 per cent, all the other sectoral indices are hovering in the positive territory. The top sectoral gainers are the Nifty metal and Nifty Auto which have surged 2.8 per cent and 2 per cent correspondingly.

The July month Nifty 50 contract commenced the session with a gap-up open at 10,700. After an initial decline, the contract recorded an intra-day low at 10,661 and continued to trend upwards. It breached the key resistance at 10,700 and extended the rally. The near-term outlook is bullish for the contract. Traders can make use of intra-day dips to buy the contract while maintaining a fixed stop-loss at 10,690. Key support at 10,700 can provide base for the contract. A strong rally above the immediate resistance level of 10,750 can take the contract higher to 10,780 and 10,800 levels. Subsequent resistance is at 10,850. On the other hand, a slump below the vital base level of 10,700 can witness a corrective decline to 10,670 and then to 10,650 levels. Next supports are at 10,630 and 10,600.

Strategy: Buy in dips with a fixed stop-loss at 10,690 levels

Supports: 10,700 and 10,670

Resistances: 10,750 and 10,780

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Published on July 06, 2020
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