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Nifty 50 September Futures (11,019)
Following a positive start, the bellwether indices - the Sensex and the Nifty began to decline due to selling pressure at higher levels. Nifty September month futures contract began the session with a gap-up open at 11,135.
However, after marking an intra-day high of 11,149, the contract started to witness selling pressure and began to decline. While trending down, the contract has breached key supports at 11,100 and 11,050. It has recorded an intra-day low of 11,001.
Volatility index, India VIX, surged 5 per cent to 17.52 levels. Selling pressure as well as profit-taking in IT and FMCG stocks are dragging the benchmark indices down.
Nifty FMCG index was down 1.6 per cent and the Nifty IT index declined 1.67 per cent in today's trade. The market breadth of the Nifty index is biased towards declines. The near-term outlook is bearish for the contract.
Traders can make use of intra-day rally to go short with a fixed stop-loss at 11,050 levels. A decisive fall below the key support level of 11,000 can drag the contract down to 10,950 and 10,900 levels in the short term. Significant resistances are placed at 11,050 and 11,100 levels.
Strategy : Go short with a stop-loss at 11,050
Supports : 11,000 and 10,950
Resistances : 11,050 and 11,100
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