Technical Analysis

Nifty Call: Buy on dips with a stop-loss at 10,910 levels

Yoganand D | Updated on September 25, 2020 Published on September 25, 2020

Nifty 50 October Futures (10,988)

The domestic equity benchmark indices - the Sensex and the Nifty 50 have started the session with a gap-up open amid mixed Asian markets. The Nikkei 225 has climbed 0.5 per cent to 23,204 while the Hang Seng index has slipped 0.4 per cent to 23,222 levels in today's session. The Sensex and the Nifty 50 have advanced 1.7 per cent and 1.6 per cent respectively. The market breadth of the Nifty 50 index is biased towards advances. On the other hand, the India VIX has slumped 7 per cent to 21.7 levels, implying a reduction in volatility. Both the Nifty mid and small-cap indices have advanced 1.7 per cent and 1.9 per cent correspondingly. All the sectoral indices are hovering in the positive territory, and the top gainers are Nifty IT and Pharma, which have jumped 3.3 per cent and 2.4 per cent respectively.

The October month index futures started the session with a gap-up open at 10,906. After an initial decline to the intra-day low of 10,857 and the contract bounced up strongly to record an intra-day high at 11,013. The near-term stance remains positive as long as the contract trades above 10,925 levels. Traders with a near-term view can make use of intra-day dips to buy the contract with a stop-loss at 10,910 levels. A decisive break above 11,000 can take the contract higher to 11,025 and then to 11,050 levels.

Strategy: Make use of dips to buy the contract with a stop-loss at 10,910 levels

Supports: 10,925 and 10,900

Resistances: 11,000 and 11,025

BL Research Bureau

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Published on September 25, 2020
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