Technical Analysis

Nifty 50 October Futures (17,895): Oct 12

Gurumurthy K | Updated on October 12, 2021

The recent rise in the crude oil prices is weighing on the sentiment

BL Research Bureau

It’s a sea of red in the Asian equity markets today. All the major Asian indices like the Nikkei 225, Shanghai Composite, KOSPI, Hang Seng are all down in the range of 0.9 per cent to 1.25 per cent. The recent rise in the crude oil prices is weighing on the sentiment.

The Dow Jones Industrial Average (34,496.06) had come-off sharply from the day’s high of 34,951 to close 0.72 per cent lower yesterday. The index has failed to breach 35,000. This keeps the 33,500-35,000 range intact. As such, the chances are high for the Dow to dip towards 33,500- the lower end of the range in the coming days.

In India, the Sensex and Nifty are down 0.25 per cent each. Sensex is trading at 59,985 and Nifty is at 17,900. Nifty can test 17,800 and Sensex can fall towards its key 59,500-59,000 support zone. 17,800 on the Nifty and 59,000 on Sensex are crucial supports which will have to hold to keep the overall uptrend intact. As such the price action at those levels will need a close watch.

Futures: The Nifty 50 October Futures (17,895) has dipped below 17,900. On the charts, the picture looks weak. There could be room to fall further during the day as long as the contract trades below 17,940. A test of 17,800-17,780 looks possible today. Traders can go short at current levels and also accumulate on a rise at 17,925. Stop-loss can be placed at 17,945. Book profits at 17,780. Trail the stop-loss to 17,870 as soon as the contract moves down to 17,845. Move the stop-loss further down to 17,840 as soon as the contract touches 17,815.

The contract will have to surpass 17,940 decisively from here to bring back the bullishness. Such a break can take the contact up to 18,000-18,100.

Strategy: Go short now and accumulate on a rise at 17,925. Keep the stop-loss at 17,945. Book profits at 17,780. Trail stop-loss to 17,870 as soon as the contract moves down to 17,845 and further down to 17,840 as soon as the contract touches 17,815.

Supports: 17,800 and 17,780

Resistances: 17,940 and 18,000

Published on October 12, 2021

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