Nifty call: Buy on dips with stop-loss at 9,380

Nifty 50 May Futures (9,440)

The Indian benchmark indices opened on the front foot and have been gaining since the session open despite mixed cues from the Asian markets. The Nifty spot and the Sensex spot indices are up by a little over 1.5 per cent each.

In Asia, the Nikkei index gained about 2 per cent today, whereas the Hang Seng and the Shanghai index are down by 1.3 per cent and 0.2 per cent respectively. Notably, the US benchmark indices closed on a positive note yesterday as the S&P 500 and Dow posted a gain of 1.5 per cent and 2 per cent, respectively.

The market breadth of the Nifty 50 index shows a ing bullish inclination as the advances-declines ratio is at 38-12. The mid-cap and small-cap indices, too, are in the green, indicating broad-based buying today. Barring the Nifty IT index (down by 0.8 per cent) and the Nifty Pharma index (down by 0.2 per cent), all the other sectoral indices are trading higher today. The Nifty PVT Bank index, up by 3.7 per cent, is the top gainer, followed by the Nifty Bank index, up by 3.5 per cent.

The May futures contract of the Nifty index began the session higher at 9,328 versus yesterday’s close of 9,309. Since the beginning of the session, the contract has been moving up and has rallied past the important level of 9,400. After marking an intra-day high of 9,455, the contract is now trading at 9,440. The indications are that the rally might get extended for the rest of the day. Hence, traders can be bullish and buy the contract on dips, with stop-loss at 9,380.

Strategy: Buy on dips with stop-loss at 9,380

Supports: 9,380 and 9,330

Resistances: 9,500 and 9,550

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