Technical Analysis

Nifty Call: Buy on rally above 11,320 levels with a fixed stop-loss

Yoganand D | Updated on July 29, 2020

Nifty 50 July Futures (11,290)

BL Research Bureau

After a positive start, the Sensex and the Nifty 50 index slipped into the negative territory and continues to be bearish. Asian markets are displaying mixed cues; the Nikkei 225 index has declined 1 per cent to 22,397, whereas the Hang Seng index has marginally gained 0.35 per cent to 24,859 levels in today's session. The Shanghai Shenzhen CSI 300 Index has jumped 2.4 per cent to 4,679 levels. The Sensex and the Nifty 50 are down by 0.4 per cent and 0.2 per cent respectively. However, the market breadth of the Nifty 50 index is biased towards advances. The India VIX has gained 2.2 per cent to 24 levels. Both the Nifty mid and small-cap indices are resilient and have jumped 1.3 per cent and 0.9 per cent respectively. The Nifty PSU Bank index is the top gainer that has zoomed 3.5 per cent, followed by the Nifty metal index, which has advanced 2.2 per cent. On the other hand, Nifty Auto and IT have declined 0.5 per cent and 0.8 per cent correspondingly.

The Nifty 50 July month contract started the session with a gap-down open at 11,291. Following the initial rally, the contract recorded an intra-day high at 11,343 and began to decline. But then it rebounded after marking an intra-day low at 11,251. It is currently trading flat. Traders can take long positions on a rally above 11,320 levels with a fixed stop-loss. The contract can trend northwards to 11,340 and then to 11,360. Next vital resistances are at 11,380 and 11,400 levels. On the downside, if the contract drops below the key base level of 11,250, selling interest will emerge, and it can decline to 11,220 and then to 11,200 levels.

Strategy: Buy on a strong rally above 11,320 levels with a fixed stop-loss

Supports: 11,250 and 11,220

Resistances: 11,320 and 11,340

Published on July 29, 2020

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