Technical Analysis

Nifty 50 May Futures (9,322)

Yoganand D, BL Research Bureau | Updated on May 05, 2020

Taking positive cues from the Asian markets, the Sensex and the Nifty began the session with a gap-up open. The Hang Seng index has gained 0.8 per cent to 23,802 levels in today's session. US key benchmark indices, the Dow and S&P 500 had marginally closed in the positive territory in the last session while Nasdaq composite index had jumped 1.2 per cent. Both the Sensex and the Nifty are charting downwards since beginning of the session and so the gains are now at 0.5 per cent and 0.6 per cent respectively. The market breadth of the Nifty index is slightly biased towards advances. The India VIX has declined 2.7 per cent to 42.5 levels. The Nifty mid cap index has gained 0.7 per cent but the small-cap index is trading flat. The Nifty realty index has slumped 2 per cent followed by Nifty PSU Bank which has slumped 1.4 per cent. The top sectoral gainers are Nifty Auto and IT that has advanced 0.7 per cent and 0.65 per cent respectively.

The Nifty May month contract started the session with a gap-up open at 9,411. The contract registered an intra-day high at 9,420 and started to decline witnessing selling interest at higher levels. It slumped below 9,400 and then 9,350 levels to mark an intra-day low at 9,316 levels. Traders should tread with caution as long as the contract trades above 9,300 levels. A plunge below this level will reinforce bearish momentum and drag the contract down to 9,250 and then to 9,220 levels. Key immediate resistances are 9,350 and 9,400. A strong rally above 9,400 can witness a corrective rally and take the contract higher to 9,420 and then to 9,450 levels.

Strategy: Go short on a decisive fall below 9,300 levels with a fixed stop-loss

Supports: 9,300 and 9,250

Resistances: 9,350 and 9,400

Published on May 05, 2020

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