Nifty 50 May Futures (18,250)
Nifty 50 and Sensex have risen back sharply recovering the loss made on Friday. Both the indices are up about 0.75 per cent each. Sensex is trading at 61,505 and Nifty 50 at 18,194. Nifty has a crucial resistance at 18,200 and 18,250. A strong break above 18,250 will boost the bullish momentum and take the index up to 18,400-18,500 or even higher this week.
Global indices
In Asia, Nikkei 225 (28,979) is down 0.6 per cent. Other major indices are in green. Kospi (2,520), Hang Seng (20,199) and Shanghai Composite (3,386) are up in the range of 0.75-1.56 per cent.
In the US, the Dow Jones Industrial Average (33,674.38) had risen back sharply on Friday thereby recovering some of the loss made that week. An immediate resistance is at 33,800. The Dow has to break above this hurdle to ease the downside pressure and rise to 34,000 and higher levels.
Nifty 50 Futures
The Nifty 50 May Futures (18,250) is up 0.65 per cent. The contract has been stuck inside a range of 18,100-18,320. Within this range, it is now moving up towards the upper end. A strong break above 18,320 will boost the bullish momentum and take the contract up to 18,400 and higher levels going forward. Failure to breach 18,320 can drag the contract down towards 18,100 again. In that case the 18,100-18,320 range will continue to remain intact.
The bias is positive. As such we will be looking for a break above 18,320 if not immediately, but eventually.
Trade Strategy
Considering the risk reward ratio and the chances for the range bound movement to continue, we suggest traders to stay out of the market.
Supports: 18,180, 18,100
Resistances: 18,320, 18,400