The sell-off in the BSE Sensex and NSE Nifty stocks has intensified ahead of the presentation of the Union Budget next week. Both the indices are down over a per cent now.

Nifty 50 has declined below the key 17,775-17,750 support zone. It is currently trading at 17,705 (down 1.05 per cent). As long as it trades below 17,800, the view will be bearish. The chances are high for the Nifty to decline towards 17,500-17,450 in the coming days.

Global indices

Majority of Asian markets are in green. In the US, the Dow Jones Industrial Average (33,949.41, up 0.61 per cent) had been volatile over the last few days. However, the index is getting strong support around 33,300. This leaves the bias positive for the Dow to break 34,000 and rise to 34,500 in the short-term.

Nifty 50 Futures

The Nifty 50 February futures (17,800) contract is down over one per cent. The contract has declined below the key support level of 17,830. Inability to bounce above 17,830 can drag it down to 17,700 today.

The contract has to see a sustained rise past 17,830 to ease the downside pressure and move up to 17,900.

Trading Strategy

High-risk appetite traders can go short now. Keep the stop-loss at 17,845. Trail the stop-loss down to 17,780 as soon as the contract falls to 17,755. Move the stop-loss further down to 17,740 when the contact touches 17,725 on the downside. Book profits at 17,710.

Supports: 17,700, 17,600

Resistances: 17,830, 17,900