Technical Analysis

Nifty call: Sell on rallies with fixed stop-loss at 8,200 levels

Yoganand D | Updated on April 03, 2020 Published on April 03, 2020

Nifty 50 April futures (8,130)

The Sensex and Nifty started the session with a gap-down open and have continued to trade in negative territory. The Asian markets are mixed, the Nikkei 225 was flat at 17,820 levels, while the Hang Seng index declined 0.5 per cent to 23,165 in today's sessions. Both the Sensex and the Nifty have slumped 2 per cent and 1.7 per cent so far. The market breadth of the Nifty is biased towards declines. The India VIX, the volatility index, has tumbled 4.8 per cent to 57 levels. The Nifty mid- and small-cap indices have declined 1.4 per cent and 1 per cent respectively. Nifty Pharma, the top gainer, has jumped 4.8 per cent. Nifty FMCG is also trading in positive territory, climbing 0.5 per cent. Other sectoral indices are trading in the red; the top loser is Nifty Bank, which has plunged 3.8 per cent.

The Nifty April month contract began the session on a flat note, opening at 8,259 levels. After marking an intra-day high at 8,330, the contract resumed its downtrend and started to decline, witnessing selling pressure at higher levels. The contract has breached a key support at 8,200 levels. The near-term stance remains bearish as long as the contract trades below 8,200 levels. Traders can sell on rallies while maintaining a fixed stop-loss at 8,200 levels. A decisive fall below the current support level of 8,100 can pull the contract down to 8,075. The next key supports are at 8,050 and 8,000 levels. On the other hand, a strong rally above 8,200 could trigger a corrective up-move to 8,250 and then to 8,300 levels. Immediate resistance is at 8,150.

Strategy: Sell on rallies with a fixed stop-loss at 8,200 levels

Supports: 8,100 and 8,075

Resistances: 8,150 and 8,200

Published on April 03, 2020

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