Nifty 50 January Futures (21,596)

Nifty 50 is trading flat. After touching an intraday low of 21,448, the index rose back to recover the loss. It is currently trading at 21,556, up 0.04 per cent.

The picture is slightly weak. Failure to rise past 21,600 from the current levels will be negative. In that case, Nifty can fall below 21,500 which can drag it down to 21,400 and even to 21,300 in the coming sessions. Only a strong rise above 21,600 will ease the downside pressure and take the Nifty up to 21,750-21,800 again.

Global indices

In Asia, barring the Nikkei 225 (34,477), other major indices are in red. Nikkei 225 has surged over 2 per cent today. Kospi (2,544), Hang Seng (16,122) and Shanghai Composite (2,887) are down in the range of 0.2-0.7 per cent.

In the US, the Dow Jones Industrial Average (37,525) was down 0.42 per cent. It continues to look vulnerable for a fall to 37,000 before a fresh rise is seen. To avoid the fall to 37,000, the Dow Jones has to sustain above 37,500 and breach 37,800 from here.

Nifty 50 Futures

The Nifty 50 January Futures (21,596) is marginally down by 0.1 per cent. The contract has its key intraday resistance at 21,630. As long as the contract trades below this resistance, the outlook will be negative.

The Nifty 50 January Futures contract can fall to 21,500 and even to 21,400 in the coming sessions.

The contract has to see a decisive rise past 21,650 to ease the downside pressure. In that case, a rise to 21,800 and higher can be seen.

Trading Strategy

We expect the contract to sustain below 21,630. So, traders can go short now and on a rise at 21,620. Keep the stop-loss at 21,660. Trail the stop-loss down to 21,575 as soon as the contract moves down to 21,545. Move the stop-loss further down to 21,555 when the contract touches 21,530 on the downside. Exit the long positions at 21,510.

Supports: 21,500, 21,400

Resistances: 21,630, 21,800