Nifty Call: Sell on rallies with stop-loss at 9,850 levels

Nifty 50 June Futures (9,780)

Tracking the bullish global markets, the Sensex and the Nifty began the session with a gap-up open. The Nikkei 225 had jumped 4.8 per cent to 22,582, and Hang Seng index has gained 2.6 per cent to 24,397 in today's session. Following initial up-move the Sensex and the Nifty have pared their intra-day gains and slipped into the negative territory, witnessing selling interest. Currently, key indices are trading flat. The market breadth of the Nifty index has turned the bias towards declines. The India VIX is hovering flat at 32.5 levels. Both the Nifty mid and small-cap indices have slipped into the negative territory and have declined 0.3 per cent and 0.6 per cent respectively. Among the sectoral indices, the Nifty metal index is the top gainer that has advanced 1 per cent while the Nifty PSU Bank index is the top loser with a 2 per cent decline.

Following a gap-up open at 10,018 levels, the Nifty futures contract had recorded an intra-day high at 10,044 and started to decline on the back of selling pressure at higher levels. Key resistance at around 10,000-mark has also limited the upside. The contract breached the key supports at 9,800 and has recorded an intra-day low at 9,703 levels, before bouncing up to 9,786 levels. The near-term will remain negative as long as the contract trades below 9,900 levels. Traders can make use of intra-day rallies to sell the contract while maintaining a stop-loss at 9,850 levels. A decisive fall below 9,750 can pull the contract down to 9,700 levels. Further decline below 9,700 can drag the contract down to 9,650 and 9,600 levels. Resistances are at 9,950 and 10,000.

Strategy: Make use of intra-day rallies to sell the contract with a stop-loss at 9,850 levels

Supports: 9,750 and 9,700

Resistances: 9,850 and 9,900

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