Technical Analysis

Nifty call: Sell on rallies with fixed stop-loss at 11,310 levels

Yoganand D | Updated on July 25, 2019 Published on July 25, 2019

Nifty 50 July futures (11,255)

The Sensex and Nifty began the July derivatives expiry session on a positive note and witnessed a rally initially. However, the benchmark indices failed to sustain the upmove and began to decline on the back of selling interest.

The market breadth of the Nifty index is now marginally biased towards declines. The volatility index, India VIX, has declined 1 per cent to 12.63 levels. Selling interest is seen in Nifty Auto, Metal and PSU Banks, which have fallen in the range of 0.5-1 per cent, while Nifty Pharma has gained 1.3 per cent.

After a positive opening at 11,290, the Nifty July month contract extended its rally and marked an intra-day high at 11,354. But, the contract began to decline, thereafter, due to selling pressure. After breaching a key level of 11,300, the contract moved lower, recording an intra-day low at 11,253. The near-term stance will remain bearish as long as the contract trades below 11,300 levels.

Traders can sell on rallies, with a stop-loss at 11,310. A strong fall below the key support level of 11,250, can drag the contract down to 11,225 and 11,200 levels. On the upside, strong rallies above 11,300 could witness a corrective up-move to 11,330 and 11,355 levels once again.

Strategy: Sell on rallies with a fixed stop-loss at 11,310 levels

Supports: 11,250 and 11,225

Resistances: 11,300 and 11,330

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Published on July 25, 2019
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