Technical Analysis

Nifty call: Go long on rally above 10,900, with a fixed stop-loss

| Updated on September 05, 2019 Published on September 05, 2019

Nifty 50 September futures (10,870)

Taking cues from the positive global markets, the Sensex and Nifty began the session in the green, opening with a gap-up. The US markets surged at the close, gaining over 1 per cent in the last session. The Nikkei 225 has advanced 2 per cent to 21,085 levels. The Hang Seng index is hovering in the negative, declining 0.4 per cent to 26,407 in today's session.

After an initial rally, both the Sensex and the Nifty failed to sustain the positive momentum and have slipped into the red, witnessing selling pressure. The Sensex is down by 0.27 per cent, while the Nifty is trading flat. However, the market breadth of the Nifty is biased towards advances. The India VIX volatility index is hovering flat at 17.2 levels.

The Nifty mid and small-cap indices are resilient and have gained 0.46 per cent and 0.6 per cent respectively. The Nifty metal index has jumped 2.3 per cent, while Nifty Bank continues to experience selling pressure and has fallen 0.8 per cent.

The Nifty September futures contract commenced the session on a flat note, opening at 10,881. Following an initial up-move to the intra-day high of 10,960, the contract declined on the back of selling interest. It has slipped below 10,850, which is a key near-term support, and has marked an intra-day low at 10,843 levels. The contract is choppy.

Traders should tread with caution and consider taking long positions on a strong rally above 10,900 levels, with a fixed stop-loss. Key resistances above 10,900 are at 10,925 and 10,950 levels. Supports below 10,850 are placed at 10,830 and 10,810 levels.

Strategy: Go long on a strong rally above 10,900 with a fixed stop-loss

Supports: 10,850 and 10,830

Resistances: 10,900 and

Published on September 05, 2019
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