Technical Analysis

Nifty Call: Sell on rallies with a stop-loss at 11,860 levels

Yoganand D | Updated on October 26, 2020 Published on October 26, 2020

Nifty 50 October Futures (11,772)

The domestic equity indices- the Sensex and the Nifty 50 started the session on red and has been trending downwards. Asian markets are mixed; the Nikkei 225 was flat at 23,494 and CSI 330 index has fallen 0.58 per cent to 4,691 levels in today's session. Both the Sensex and the Nifty 50 have slumped 1.2 per cent each so far. The market breadth of the Nifty 50 is biased towards declines. On the other hand, the India VIX has jumped 5.5 per cent to 23.03 levels. The Nifty mid and small-cap indices have tumbled 1.6 per cent and 0.9 per cent respectively. All the sectoral indices are trading in negative territory. The top losers are the Nifty metal and auto indices that have plunged 4 per cent and 3 per cent, respectively.

The Nifty 50 October month contract started the session on a flat note at 11,933. After marking an intra-day high at 11,950 and the contract began to decline and has breached key supports at 11,900 and 11,800 levels. It has recorded an intra-day low at 11,741 levels. The near-term outlook is bearish for the contract. Traders can make use of intra-day rallies to go short with a stop-loss at 11,860 levels. A decisive fall below the immediate support level of 11,750 can pull the contract down to 11,725 and then to 11,700 levels. Next supports are at 11,670 and 11,650. Resistances are at 11,850 and 11,900 levels.

Strategy: Sell on rallies with a stop-loss at 11,860 levels

Supports: 11,750 and 11,725

Resistances: 11,850 and 11,900

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Published on October 26, 2020
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