Extending the recovery in the second half of Thursday’s session, the Indian benchmark indices opened on a positive note today. Post open, both Nifty 50 and Sensex rallied and is now up by over 1 per cent each as they are at 17,320 and 57,890, respectively. Also, most of the major Asian indices are in the green, substantiating the bullish inclination. Early risers, ASX 200 and Nikkei 225, have gained over 2 per cent each and KOSPI is up by 1.4 per cent. Hang Seng is the only index down so far, down by 1.1 per cent.

Another factor supporting the positivity is the market breadth of the Nifty i.e., the advance-decline ratio stands at 48-2. Like the benchmark indices, the mid- and small-cap indices have gained between 1.7 and 2.5 per cent. Moreover, all the sectoral indices are up today, led by the Nifty Realty index, up by nearly 3 per cent, followed by the Nifty Media, up by 2.4 per cent. There is a drop in volatility as indicated by India VIX, which is down by 2.5 per cent as it currently stands at 20.50. So, these factors show considerable bullishness and a broad-based buying, hinting that the market per se is likely to remain positive for the rest of the day.

Futures: Following the underlying Nifty 50 bullish beginning, the February futures of the index opened with a gap-up at 17,200 versus Thursday’s close of 17,149. It has been rallying since the beginning of the session. After hitting an intraday high of 17,385, the contract is currently hovering around 17,330.

Since indications are bullish, traders can consider fresh longs at current levels. The contract will most likely rally to 17,500 from here. A breach of this level can result in the futures touching 17,600. On the downside, 17,270 and 17,230 can offer good support.

Considering the above factors, traders can buy afresh at the current level of 17,330 and accumulate if the contract dips to 17,270. Place stop-loss at 17,220. When the contract touches 17,500, exit three-fourths of the long, revise the stop-loss to 17,380, and liquidate the rest at 17,590.

Strategy: Buy the contract at current levels (17,330) and on dips to 17,270. Place stop-loss at 17,220. When the contract touches 17,500, exit three-fourths of the long and revise the stop-loss to 17,380. Liquidate the remaining longs at 17,590.

Supports: 17,270 and 17,230

Resistances: 17,500 and 17,600

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