Nifty 50 December futures (13,235)

The domestic benchmark indices - the Sensex and the Nifty 50 - started the session on a positive note amid lacklustre Asian markets. The Nikkei 225 has slipped 0.2 per cent to 26,751, while the Hang Seng index is marginally up by 0.2 per cent at 26,779 levels. After an initial rally, the Sensex and the Nifty 50 began to witness selling interest at higher levels and started to decline. Paring some of the intra-day gains, the Sensex and Nifty 50 have climbed 0.3 per cent each so far.

The market breadth of the Nifty 50 is biased towards advances. The India VIX has slumped 4.3 per cent to 18.18 levels, indicating a decrease in volatility. The Nifty mid and small-cap indices have declined 0.4 per cent and 0.25 per cent, respectively. Selling interest is seen in the Nifty PSU Bank that has fallen 1 per cent. The Nifty FMCG and IT are the top sectoral indices gainers that have advanced 1 per cent and 0.5 per cent correspondingly.

The December month Nifty 50 futures contract commenced the session with a gap-up open at 13,220 and marked an intra-day high at 13,297. But witnessing selling interest at higher levels, the contract pared some of its intra-day gains. Key support at 13,200 is cushioning the contract. As long as the contract trades above this base level, the near-term stance will stay positive. A rally above the immediate resistance level of 13,250 can take the contract higher to 13,275 and then to 13,300 levels. But a decisive fall below the base level of 13,200 can pull the contract down to 13,170 and then to 13,150 levels. Key supports below 13,150 are at 13,125 and 13,100 levels.

Strategy: Go long on a clear rally above 13,250 levels with a fixed stop-loss

Supports: 13,200 and 13,170

Resistances: 13,250 and 13,275

Published on December 4, 2020