Nifty 50 and Sensex are trading marginally lower. Nifty is trading at 16,957, down 0.18 per cent while Sensex is flat at 57,590. Broadly the short-term outlook is unclear. Nifty is stuck inside a range of 16,800-17,200.

The chances are high now for the index to come down towards the lower end of this range. A breakout on either side of 16,800-17,200 will give a clear cue on the next direction of move. So we prefer to stay out of the market and just watch the price action.

Global indices

In Asia, barring the Nikkei 225 (27,466, down 0.04 per cent) other major indices are in green. Kospi (2,425), Hang Seng (19,720) and Shanghai Composite (3,258) are all up in the range of 0.2-0.8 per cent.

In the US, the Dow Jones Industrial Average (32,432, up 0.6 per cent) is up moving up over the last few days. There is room to test 32,600-32,800. The index has to breach 32,800 decisively to gain bullish momentum. Failure to break above 32,800 can trigger a reversal again.

Nifty 50 Futures

The Nifty 50 March Futures (16,984) is down 0.3 per cent. On the intraday chart the bias is negative.

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Markets expect to remain lacklustre

A test of 16,940-16,920 looks likely during the day. Thereafter if the contract manages to bounce back, it can move up to 17,000 and higher again. In that case 16,900-17,200 will be the trading range.

As such the price action around 16,900 will need a close watch. On the other hand, a sustained break below 16,900 can drag the contract further down to 16,800.

Trading strategy: Considering the lack of clarity on the direction of move and the risk reward ratio, we suggest traders to stay out of the market.

Supports: 16,940, 16,900

Resistances: 17,000, 17,080

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