Nifty 50 saw a recovery yesterday after witnessing considerable sell-off on Wednesday. Today, it opened with a gap-down at 22,065 versus yesterday’s close of 22,147. After opening lower, the index declined further and is now hovering around 22,000, down 0.7 per cent.

The advance/decline ratio of Nifty 50 stands at 12/38. Bajaj Finance, up 2.5 per cent, is the top performer whereas BPCL, down 4.6 per cent, is the top loser.

Like the benchmark index, mid- and small-cap indices are also in the red. Among the sectors, barring Nifty Realty, up nearly 0.4 per cent, all others have fallen today. Nifty Oil & Gas, down 1.9 per cent, is the worst performer so far today.

Nifty 50 futures

The March futures of Nifty 50 opened today’s session lower at 22,186 as against yesterday’s close of 22,265. It is now trading around 22,070, down 0.9 per cent.

Although the trend is bearish, Nifty futures is trading above an important support at 22,050. If this level is breached, the downswing will most likely extend to 21,930.

On the other hand, if the contract bounces off the support at 22,050, it will face resistance at 22,200. Subsequent barrier is at 22,300.

Broadly, the trend is bearish and is likely to slip below the support at 22,050. Even if there is a rebound from the current level, it can be short lived. So, traders can consider short positions.

Trading strategy

Traders can either short Nifty futures once it slips below 22,050. Target and stop-loss can be at 21,930 and 22,100 respectively.

But if Nifty futures moves up from here, initiate short when it touches 22,130. Place stop-loss at 22,220. When the contract slips below 22,050, revise the stop-loss to 22,100. Book profits at 21,930.

Supports: 22,050 and 21,930

Resistance: 22,200 and 22,300

Related Topics
comment COMMENT NOW