Nifty 50 opened with a gap-up today at 21,543.50 versus Tuesday’s close of 21,453.10. It is now hovering around 21,570, up 0.6 per cent.
Supporting the bullish bias, the advance/decline ratio of Nifty 50 stands at 41/9. Like the benchmark index, all mid- and small-cap indices too have gained.
Besides, all the sectoral indices are in the green as well, indicating a broad-based buying. Nifty Consumer durables and Nifty Oil and Gas are the top gainers, up 1.4 per cent each so far.
The chart of Nifty 50 and Nifty futures show a fresh breakout, implying that the probability of further rally in high.
Nifty 50 futures
The December futures contract of Nifty 50 opened today’s session higher at 21,595.10 as against yesterday’s close of 21,527.75. It is currently trading at 21,660, up 0.65 per cent.
The rally past 21,600 means the contract has opened the door for further rally. While 21,700 can be a hurdle, we expect Nifty futures to appreciate to 21,800.
But in case the contract declines from the current level of 21,660, it can find support at 21,600 and 21,500. Nevertheless, a fall below 21,600 today is less likely.
Trading strategy
Buy Nifty futures now at 21,660 and add longs in case the price dips to 21,600. Place stop-loss at 21,550 at first.
When the contract surpasses 21,720, tighten the stop-loss to 21,650. Book profits at 21,780.
Supports: 21,600 and 21,500
Resistance: 21,700 and 21,800