Nifty 50 is trading higher. Two consecutive days of gap-up open is a positive. However, there seems to be lack of strong follow-through buying after that. On Friday, the index remained stable after the gap-up open. Today, it is coming down after making an intraday high of 21,720.

Series of supports are available at 21,640, 21,620 and 21,600. We expect the Nifty to reverse higher from any of these three supports. That will keep the near-term outlook bullish and take the Nifty up to 21,750-21,800.

Nifty 50 Futures

The Nifty 50 January Futures (21,693) is up 0.1 per cent. The contract touched a high of 21,759 and has come down from there. Support is near current levels at 21,680. A bounce from here will be bullish to see 21,800-21,850 on the upside in the coming sessions.

But a break below 21,680 can bring the contract under pressure. Such a break can take the Nifty 50 January Futures contract down to 21,600-21,580 in the coming sessions.

Trade Strategy

Considering the supports in the 21,640-21,600 region on the Nifty 50, we expect the Nifty 50 Futures to hold above 21,680. So, traders with high-risk appetite can go long now. Keep a stop-loss at 21,660. Trail the stop-loss up to 21,715 as soon as the contract moves up to 21,735. Move the stop-loss further up to 21,745 when the contract touches 21,760. Exit the long positions at 21,770.

Supports: 21,640, 21,600

Resistances: 21,750, 21,800

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