Nifty 50 September Futures (19,675)

Nifty 50 and Sensex continue to fall. The strong sell-off witnessed last week is spilling over this week as well. Both the indices are down about 0.28 per cent each.

 Nifty has room to test 19,600 and even 19,500 in the coming sessions. The price action thereafter will need a close watch. A bounce from around 19,500 will give a breather. It can trigger a relief rally towards 19,800.

Also read: Blue Star, Berger Paints, REC Ltd: Three stocks that outperformed in the week ending September 22

On the other hand, a break below 19,500 will intensify the selling pressure. Such a break can drag the Nifty down to 19,200-19,100 going forward.

Global indices

In Asia, barring Nikkei 225 (32,666, up 0.8 per cent) other major indices are in red. Hang Seng (17,833) is down the most by 1.2 per cent. Kospi (2,497) and Shanghai Composite (3,120) are down about 0.4 per cent each.

In the US, the Dow Jones Industrial Average (33,963) extended the fall on Friday as well and was down 0.3 per cent. The index looks vulnerable to test 33,700 and even 33,500 as long as it stays below 34,000.

Nifty 50 Futures

The Nifty 50 September Futures (19,675) is down 0.15 per cent. Resistance is at 19,720 while below which the bias will continue to remain negative for the day. The Nifty 50 September Futures can fall to 19,550 in the coming sessions.

A strong rise past 19,720 is needed to negate the above-mentioned fall to 19,550. Such a rise can take the contract up to 19,820. But that looks less likely for now as fresh sellers can come into the market at higher levels and cap the upside.

Trade Strategy

Traders can go short now. Add more shorts on a rise at 19,710. Keep the stop-loss at 19,740. Trail the stop-loss down to 19,650 as soon as the contract moves down to 19,615. Move the stop-loss further down to 19,605 when the contract touches 19,590. Exit the short positions at 19,570.

Supports: 19,550, 19,500

Resistances: 19,720, 19,820