Technical Analysis

Nifty 50 June Futures (9,404)

Akhil Nallamuthu, BL Research Bureau | Updated on May 29, 2020

The Indian benchmark indices i.e. the Nifty spot and the Sensex spot indices are trading with a downward bias. The Nifty spot is down by 0.2 per cent whereas the Sensex spot is down by 0.4 per cent. Among the major Asian indices, the Nikkei index is down by 0.3 per cent and the Hang Seng index is down by 0.7 per cent.

The market breadth of the Nifty 50 index is biased towards bulls as 34 out of the 50 stocks in the index are in the green so far. Even though the benchmark indices are slightly trading lower, the mid-cap and the small-cap indices have been gaining. Among the sectoral indices, the Nifty Realty index, up by a little over 2 per cent, is the top performer. The Nifty Bank index is the top loser, down by 0.9 per cent. The volatility has come down marginally as shown by the volatility index – India VIX, which is down by nearly 0.7 per cent to 29.8 levels.

The June futures contract of the Nifty index, after opening lower at 9,398 versus yesterday’s close of 9,427, rallied during the initial hour of trade. But after making an intraday high of 9,469, the contract is now trading at 9,404. The rally looks weak and it may not sustain unless it breaches the critical level of 9,470 and 9,500 decisively. Until then, it can face downward pressure. Hence, for intraday, traders can short the contract on rallies with stop-loss at 9,470.

Strategy: Sell on rallies with stop-loss at 9,470

Supports: 9,380 and 9,360

Resistances: 9,470 and 9,500

Published on May 29, 2020

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