Nifty 50 February Futures (17,715).
The Indian benchmark indices seems to be lacking a strong follow-through buying to take them above their crucial resistances. Nifty is struggling to break above the 17,750-17,800 resistance zone and 59,500-60,000 region is holding on the Sensex.
Both the indices are trading in red. Nifty is at 17,714 and is down 0.37 per cent. Sensex is down 0.4 per cent and is at 59,315. Support for Nifty is at 17,650. For Sensex the support is at 59,000. It will have to be seen if the indices manage to sustain above their supports or not.
A break below the above-mentioned supports can see a fall to 17,500-17,450 on the Nifty and 58,500-58,000 on the Sensex. On the other hand, a strong rise past 17,800 and 60,000 will be needed for the Nifty and Sensex respectively to become strongly bullish. It is a wait and watch situation now.
Asian markets, Dow Jones
In Asia, Nikkei 225 (27,223) is down 1.13 per cent and Kospi (2,729) is up sharply by 2.5 per cent. Hong Kong and China markets are closed on account of public holiday. The Dow Jones Industrial Average (35,629.33) continues to move up. It has risen above 35,500 and is bullish to test 36,000-37,000 on the upside in the coming days.
Futures: The Nifty 50 February Futures (17,715) has come-off after testing the resistance at 17,800 mentioned yesterday. Inability to rise past 17,800 decisively leaves the near-term view slightly negative. The contract can fall to 17,650. A break below 17,650 will increase the downside pressure and see a steeper fall to 17,500.
Traders can consider taking a positional trade. Go short at current levels and accumulate shorts on a rise at 17,785. Keep the stop-loss at 17,885. Trail the stop-loss down to 17,680 as soon as the contract moves down to 17,610. Move the stop-loss further down to 17,620 as soon as the contract touches 17,570. Book profits at 17,530.
The contract will have to rise past 17,800 decisively to negate the above-mentioned fall and become bullish towards 18,000.
Trade strategy: Go short now and on a rise at 17,785. Keep a stop-loss at 17,885 for the target of 17,530. Trail the stop-loss down to 17,680 as soon as the contract moves down to 17,610. Move the stop-loss further down to 17,620 as soon as the contract touches 17,570
Supports: 17,650 and 17,500
Resistances: 17,800 and 18,000