Technical Analysis

Nifty call: Initiate longs above 12,110

Akhil Nallamuthu BL Research Bureau | Updated on December 13, 2019 Published on December 13, 2019

Nifty 50 December Futures (12,110)

The Indian benchmarks have been upbeat since the start of the session. The Nifty spot index and the Sensex spot index are up by 0.7 per cent and 0.8 per cent respectively. Positive sentiment prevails in major Asian indices as well. The Nikkei closed with a gain of 2.55 per cent and the Hang Seng index is trading higher by 2.16 per cent. The US benchmarks too closed with considerable gain yesterday.

The December futures of the Nifty 50 index opened on a positive note at 12,060 versus yesterday’s close of 12,028. The contract has been gaining ground and is currently testing the resistance level of 12,110.

The market breadth of the Nifty 50 index is bullish as the advance-decline ratio is at 36-14. Among sectoral indices, except the Nifty pharma index (down by 0.7 per cent) all other indices have gained. The top performer being the Nifty PSU bank index, up by nearly 3 per cent. The advance-decline ratio and the sectoral indices indicate broad based buying. However, volatility has shot up, which one needs to be wary of, as higher volatility is generally associated with bearish sentiment. The volatility index, India VIX is up by 3.4 per cent to 13.8 levels.

As the equity markets across the globe look sanguine, and the December futures of the Nifty 50 index has been on the rise since the morning session, the momentum is clearly in favour of the bulls. But, the current level of 12,110 is a notable resistance. Hence, traders are recommended to initiate fresh long positions above 12,110 with stop-loss at 12,045.

Strategy: Initiate longs above 12,110 with stop-loss at 12,045

Supports: 12,055 and 12,000

Resistances: 12,155 and 12,190

Published on December 13, 2019
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