Nifty 50 has been volatile today. The index has been oscillating up and down between 21,650 and 21,800. It is currently trading at 21,735, up 0.08 per cent.

Broadly, the sentiment is negative. Important resistance for the day is at 21,800. As long as the Nifty trades below 21,800, the chances are high for it to fall to 21,600 and even lower in the coming sessions. 

A sustained rise above 21,800 is needed to ease the downside pressure and move up towards 22,000 again.

Global indices

In Asia, barring the Hang Seng (15,746, down 0.83 per cent), other major indices are in green. Shanghai Composite (2,865) is up 1.28 per cent. Nikkei 225 (37,039) and Kospi (2,620) are up over 0.4 per cent each.

The Dow Jones Industrial Average (38,726) was up 0.13 per cent. The index is moving up gradually. The short-term outlook remains bullish to see 39,300-39,400 on the upside from here. Thereafter the index can witness a correction.

Nifty 50 Futures

The Nifty 50 February Futures (21,806) is trading flat. The outlook is negative. The contract has resistances at 21,850 and 21,920. The chances are high for the Nifty 50 February Futures to see a fall to 21,700 and 21,600 in the coming sessions.

A strong rise above 21,920 is needed to turn the outlook positive. But that looks less likely as fresh sellers are likely to come into the market at higher levels.

Trade Strategy

Traders can go short now at 21,806. Accumulate on a rise at 21,840. Keep a stop-loss at 21,880. Trail the stop-loss down to 21,780 as soon as the contract falls to 21,755. Move the stop-loss further lower to 21,730 when the contract touches 21,710 on the downside. Exit the shorts at 21,700.

Supports: 21,700, 21,600

Resistances: 21,850, 21,920