Nifty call: Go long on a break above 10,490 with a stop-loss at 10,475

The Nifty 50 futures contract is stuck in a sideways range between 10,425 and 10,490 over the last few sessions. Within this range, the contract is currently trading around the mid-point at 10,462.

A breakout on either side of 10,425 or 10,490 will determine the next move. Traders can stay out of the market until the range breakout gives a confirmed trade signal.

A strong break below 10,425 can take the contract lower to 10,400 initially. Further break below 10,400 will increase the likelihood of the fall extending to 10,380 or even 10,360.

On the other hand, if the index futures manage to breach above 10,490 decisively, it can target the next key resistance level of 10,525. Inability to break above 10,525 can trigger a pull-back move to 10,490. But a strong break above 10,525 can target 10,545 thereafter.

Short-term traders with high risk appetite can go long on a break above 10,490. Stop-loss can be placed at 10,475 for the target of 10,525. Revise the stop-loss higher to 10,505 as soon as the contract moves up to 10,510.

Strategy: Go long on a break above 10,490 with a stop-loss at 10,475

Supports : 10,425, 10,400

Resistances : 10,490, 10,525

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