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BL Research Bureau
Even though the Asian markets are mixed, the Indian equity benchmarks, the Nifty 50 and the Sensex opened the session on the positive side and are now up by about 0.2 per cent each. Among the Asian majors, the Nikkei 225 gained 2 per cent whereas the Hang Seng is down by a little 1 per cent. Irrespective of how other Asian indices perform, the domestic benchmarks are likely to retain the positive bias for the day.
The market breadth of the Nifty 50 is indicating a bull trend as the advance-decline ratio currently stands at 28-22. In line with this, all the mid- and small-cap indices are in the green, gaining between 0.4 and 0.7 per cent. But the sectoral indices give us a diverse view as some of the indices have gained whereas some are in the red. The Nifty Realty and Media indices are the top gainers, up by 1.7 and 1.6 per cent. On the other hand, the Nifty Financial services index is the top loser, down by 0.3 per cent followed by the Nifty FMCG index, down by 0.25 per cent.
Futures: The September futures contract of the Nifty 50 opened with a minor gap-up at 17,261 as against the previous close of 17,247. Initially it rallied to mark an intraday high of 17,323 but gave up some of the gains and is now trading around 17,280, about 0.2 per cent higher compared to yesterday’s close. The contract has found good support at 17,225 and as long as it trades above this level, the intraday trend will remain bullish.
Hence, one can consider buying the contract with stop-loss at 17,220. Stick to this stop strictly because a breach of this level can turn the intraday trend bearish. On the upside, the futures is likely to retest 17,323 and could touch 17,350. The likelihood of it reaching 17,400 also looks reasonable. Notable supports from the current levels are at 17,225 and 17,150.
Strategy: Buy the contract with strict stop-loss at 17,220
Supports: 17,225 and 17,150
Resistances: 17,323 and 17,350
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