Nifty 50 February Futures (21,790)

Nifty 50 has begun the week on a weak note. The index opened with a gap-up but failed to sustain higher. It made a high of 21,831.70 and has come down from there. Nifty is currently trading at 21,740, down 0.2 per cent.

The outlook is negative. Strong resistance is in the 21,800-21,850 region. As long as the Nifty stays below this resistance zone, the chances are high for it to fall to 21,600 initially and then to 21,400 and lower eventually in the coming sessions.

Global indices

The Dow Jones Industrial Average (38,671.69) was down 0.14 per cent on Friday. The index has support at 38,500. As long as it trades above this support, the view of seeing a rise to 39,300-39,400 will remain intact. In case the Dow declines below 38,500, it can fall to 38,100 in the near-term.

Most of the major Asian markets are closed today.

Nifty 50 futures

The  Nifty 50 February futures (21,790) is down 0.24 per cent. There was a spike to a high of 22,088 in opening trades, and the contract has come down sharply from there.

The outlook is bearish. Intraday resistance is in the 21,850-21,870 region, which can cap the upside for the day. The contract can fall to 21,650 and even lower in the coming sessions.

Trade Strategy

Traders can go short now. Accumulate on a rise at 21,830. Keep the stop-loss at 21,880. Trail the stop-loss down to 21,760 as soon as the contract falls to 21,710. Move the stop-loss down to 21,705 when the contract touches 21,675. Exit the shorts at 21,660.

Supports: 21,650, 21,600

Resistances: 21,870, 22,000.

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