Following a gap-up open and initial hour rally, the Sensex and the Nifty slipped and took support at the previous close. But, the benchmark indices once again started to trend upwards. The Sensex has climbed 0.5 per cent and the Nifty advanced 0.67 per cent so far. Asian markets were trading with a bullish bias, the Nikkei 225 had gained 0.7 per cent to 22,863 and Hang Seng index had increased 0.8 per cent to 24,569 levels. The market breadth of the Nifty index is biased towards advances. Whereas the India VIX has slumped 2.2 per cent 29 levels. The Nifty small-cap index (up by 2.5 per cent) has again outperformed the Nifty mid-cap index (up by 1 per cent). Apart from the Nifty IT index which has slipped 0.6 per cent, all the other sectoral indices are trading in the positive territory. The top sectoral gainers are Nifty metal and media that have advanced 3.6 per cent and 3.3 per cent respectively.

The Nifty June month contract commenced the session with a gap-up open at 10,066. After an recording an intra-day high at 10,137 and started to decline. But it took support marking an intra-day low at 10,040. The near-term outlook remains positive as long as the contract trades above 10,040 levels. Traders can buy the contract with a stop-loss at 10,030. A decisive rally above the current resistance level of 10,100 can take the contract northwards to 10,130 and then to 10,150 levels. However, a decisive fall below 10,040 will bring back selling interest and drag the contract down to 10,020 and 10,000 levels. Subsequent supports are at 9,970 and 9,950 levels.

Strategy: Buy on dips with a fixed stop-loss at 10,030 levels

Supports: 10,040 and 10,020

Resistances: 10,100 and 10,130

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