The Indian benchmark indices – Nifty 50 (17,500) and Sensex (59,525) – have rallied today and are up by nearly 0.7 per cent each. The recent bounce seems to be sustaining and this increases the chances for both indices to appreciate further.

Substantiating the bullish bias, the advance/decline ratio of Nifty 50 stands at 30/20. Besides, most mid- and small-cap indices are in the green. Among the sectors, Nifty IT is the best performer as it has gained nearly 1 per cent, whereas Nifty PSU Bank is the top loser, down by 1.2 per cent.

The Indian equity market looks positive despite mixed signals from the Asian peers. Among them, Nikkei 225 (27,820) has lost 1.7 per cent, KOSPI (2,495) is up 0.6 per cent, whereas ASX 200 (7,230) has been flat for the day.

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Nevertheless, Nifty 50 looks to be in a position to gain more and thus, the futures contract could see a rise in price.

Nifty 50 futures

The April futures of the Nifty 50 index opened the day slightly higher at 17,487 versus Monday’s close of 17,475. It has now rallied to 17,550.

The price action indicates that the contract might rally to 17,650 – a resistance. Subsequent resistance is at 17,750. But in case the contract drops, it can find support at 17,500 and 17,400. We do not expect Nifty futures to fall below 17,500 today.

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Trading strategy

Go long on Nifty futures at the current level of 17,550. Add more longs when the price dips to 17,500. Place stop-loss at 17,450. When the contract touches 17,600, tighten the stop-loss to 17,540. Book profits at 17,650.

Note that the above trade recommendation is for intraday. So, exit the positions by the end of the day if neither target nor stop-loss is triggered.

Supports: 17,500 and 17,400

Resistance: 17,650 and 17,750

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