Technical Analysis

Nifty call: Buy on dips with fixed stop-loss at 15,070 levels

Yoganand D | Updated on February 25, 2021

Nifty 50 February futures (15,112)

Tracking the positive global markets, the Sensex and Nifty 50 commenced the session with a gap-up open and continued to trend upwards. The Dow Jones has gained 1.3 per cent to 31,961 and the S&P 500 has advanced 1.1 per cent to 3,925 in the past session.

Asian markets began the session on a positive note, taking cues from the US markets. The Nikkei 225 index has jumped 1.6 per cent to 30,168 and the Hang Seng index has gained 1.5 per cent to 30,183 in today's session. The Sensex and Nifty 50 have advanced 0.7 per cent and 0.9 per cent respectively. The market breadth of the Nifty 50 is biased towards advances.

On the other hand, the India VIX has fallen 4.3 per cent to 23.1 levels. Both the Nifty mid and small-cap indices have gained 1.3 per cent and 1.1 per cent respectively. Among the sectoral indices, the Nifty FMCG is the only index trading in negative territory, down by 0.3 per cent. The top sectoral gainers are Nifty metal that has jumped 3 per cent and Nifty Pharma that has advanced 1.5 per cent.

On the derivatives expiry day, the February month contract started the session with a gap-up open at 15,078 and moved higher to record an intra-day high at 15,180 levels. But the contract gave away some of its gains and currently hovers at 15,110 levels. Below 15,100, the key support at 15,050 can provide a base on the downside. As long as the contract trades above 15,075, the near-term outlook stays positive and so, traders can buy the contract with a stop-loss at 15,070. A strong rally above the immediate resistance level of 15,130 can take the contract higher to 15,150 and 15,180 levels. Key supports below 15,050 are at 15,025 and 15,000.

Strategy: Buy on dips with a fixed stop-loss at 15,070 levels

Supports: 15,075 and 15,050

Resistances: 15,130 and 15,150

Published on February 25, 2021

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