Nifty 50 May Futures (18,240)
Sensex and Nifty 50 have opened the week on a positive note. Both the indices opened with a gap-up and are up about 0.5 per cent each. Sensex is trading at 61,427 and Nifty at 18,161. The outlook is bullish. Nifty has room to test 18,200-18,300 from here. Thereafter, a short-lived corrective dip is possible.
Global indices
In Asia, most major indices are in green. Nikkei 225 (29,204), Kospi (2,517) and Hang Seng (19,912) are all up in the range of 0.1-0.65 per cent.
In the US, the Dow Jones Industrial Average (34,051.70) has come off from the high of 34,257. There is resistance at 34,300. A strong break above it is needed for the Dow to move further up. A corrective dip to 33,800 is a possibility before a fresh rise happens.
Nifty 50 Futures
The Nifty 50 May Futures (18,240) contract is up about 0.7 per cent. The outlook is bullish. The contract can rise to 18,320 from here. Support is at 18,180. The contract will come under pressure on a fall below 18,180. In that case 18,130-18,100 can be seen on the downside. But the price action on the chart is strong. So, the chances are high for the Nifty 50 May Futures contract to sustain above 18,180.
Trading Strategy
Considering the risk-reward ratio, we suggest traders wait for dips and go long at 18,220 and 18,200. Keep the stop-loss at 18,160. Trail the stop-loss up to 18,240 as soon as the contract moves up to 18,265. Move the stop-loss further up to 18,275 when the contract touches 18,295. Exit the longs at 18,310.