Technical Analysis

Nifty Call: Go long on a strong rally above 11,490 levels

Yoganand D BL Research Bureau | Updated on October 16, 2019 Published on October 16, 2019

Traders with a near-term view should tread with caution and consider initiating long positions above 11,490 levels with a fixed stop-loss

Nifty 50 October Futures (11,466)

The Sensex and the Nifty opened in the green, tracking positive global cues. The Dow Jones had gained 0.89 per cent to 27,024 levels and S&P 500 index surged 1 per cent to 2,995 levels in the previous session. The Nikkei 225 has advanced 1.18 per cent to 22,454 levels and Hang Seng index has climbed 0.3 per cent to 26,594 levels in today's session.

After a positive start, both the Sensex and the Nifty started to experience selling interest at higher levels and have turned volatile. The market breadth of the Nifty is biased towards advances. The India VIX index has declined 2 per cent to 16.5 levels. The Nifty mid-cap index is trading flat while the small-cap index has gained 0.6 per cent.

The Nifty October month futures contract started the session on a positive note at 11,458 levels. After marking an intra-day high at 11,484 the contract declined and recorded an intra-day low at 11,427 levels. But, the contract has bounced back from its intra-day low and hovers around 11,465 levels. It faces a key resistance ahead in the band between 11,485 and 11,490.

A strong break above this resistance band can take the contract higher to 11,525 and then to 11,550 levels. Traders with a near-term view should tread with caution and consider initiating long positions above 11,490 levels with a fixed stop-loss. On the other hand, a decisive fall below the immediate support at 11,440 can drag the contract down to 11,425 and then to 11,400 levels.

Strategy: Go long on a strong rally above 11,490 levels with a fixed stop-loss

Supports: 11,440 and 11,425

Resistances: 11,490 and 11,525

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Published on October 16, 2019
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