Technical Analysis

Nifty call: Buy the contract with stop-loss at 11,380

Akhil Nallamuthu | Updated on September 08, 2020

Nifty 50 September Futures (11,430)

Following the positive cues from the Asian markets, the Indian benchmark indices are up today. The Nifty 50 and the Sensex are trading higher by 0.5 per cent and 0.65 per cent, respectively. Among the major indices in Asia, the Nikkei 225 ended the day 0.8 per cent higher. While the Hang Seng index is up by 0.2 per cent, the Shanghai composite index is up by 0.7 per cent.

Though the Nifty 50 index has gained today, the market breadth does not support a bullish bias. The advances-declines ratio currently stands at 23-27.

Following the benchmarks, the mid-cap and the small-cap indices have gained 0.1 per cent and 0.9 per cent, respectively. Among the sectoral indices, the Nifty IT index is the top performer, up by 1.75 per cent, whereas the Nifty media index is the top loser, down by 0.5 per cent. Volatility has dropped slightly as the major indices are up today. India VIX – the volatility index – is down by 1.3 per cent at 21.7.

The September futures of the Nifty 50, after opening the session marginally lower at 11,348, has been gaining and is now trading near the highest point of the day i.e. around 11,430. The price action hints that the contract is likely to gain from here. While the nearest resistance can be 11,460, a rally above that level can take the contract to 11,520. Hence, traders can buy the contract with stop-loss at 11,380.

Strategy: Buy the contract with stop-loss at 11,380

Supports: 11,380 and 11,350

Resistances: 11,460 and 11,520

Published on September 08, 2020

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