Nifty futures (21,920)

Nifty 50 opened today’s session higher at 21,907 versus yesterday’s close of 21,840. It has now softened to 21,870, up 0.1 per cent for the day so far.

While the benchmark index looks marginally positive, the mid- and small-cap indices have advanced well. For instance, Midcap 50 and Smallcap 50 are up 0.7 and 1.3 per cent, respectively.

Among the sectors, Nifty Oil and Gas is the top gainer by rallying 2.1 per cent whereas Nifty Healthcare, down 0.4 per cent, is the top loser.

Nifty 50 futures

The February futures of Nifty 50 opened today’s session with a gap-up at 21,970 as against yesterday’s close of 21,917. It has given up the gains and is now hovering around 21,920.

While the gap-up open has taken Nifty futures above 21,850, it has softened a little post the open. Since the contract has gone past 21,850, the odds for a rally have gone up.

Nifty futures might rally to the nearest resistance at 22,000. It could even extend the rally to 22,070.

On the other hand, if the contract falls from the current level, 21,850 can be expected to arrest the decline. However, a breach of this can lead to a fall towards 21,700.

Trading strategy

Buy Nifty futures now at 21,920 and add longs if it dips to 21,870. Place stop-loss at 21,800. When the contract rallies past 22,000, tighten the stop-loss to 21,900. Exit at 22,050.

Supports: 21,850 and 21,700

Resistance: 22,000 and 22,070