Nifty 50 and Sensex have begun the week on a positive note. The strong bounce from Friday’s low is getting a good follow-through rise today. This is a positive. Sensex is trading at 61,869, up 0.21 per cent and Nifty is at 18,254, up 0.3 per cent.

Nifty will now have support at 18,200. However, key resistance is at 18,300. Nifty has to breach this hurdle to gain bullish momentum. Only in that case, a further rise to 18,500-18,600 and higher levels can be seen. Failure to break above 18,300 can keep the index in a range of 18,000-18,300 for some time. It will also keep the chances alive of the index revisiting 18,000 levels again.

Global indices

In Asia, all major indices are in green. Hang Seng (19,702), up 1.3 per cent is outperforming others. Nikkei 225 (30,913), Kospi (2,560) and Shanghai Composite (3,287) are up in the range of 0.1-0.9 per cent.

In the US, the Dow Jones Industrial Average (33,426.63) was down on Friday. It has a key support at 33,000 and resistance at 33,800. It can oscillate within these levels for some time. A breakout on either side of 33,000-33,800 will decide the next direction of move.

Nifty 50 Futures

The Nifty 50 May Futures (18,255) is up about 0.14 per cent. Supports for the day are at 18,225 and 18,190. A rise to test the intraday resistance at 18,340 is possible. But the contract has to breach 18,340 to move further up towards 18,400 and higher levels.

The contract will come under pressure if it declines below 18,190. In that case, it can fall to 18,150-18,100.

Trade Strategy

Traders can go long on dips at 18,235 and 18,215. Keep the stop-loss at 18,180. Trail the stop-loss up to 18,245 when the contract moves up to 18,275. Move the stop-loss further up to 18,295 when the contract touches 18,315. Exit the longs at 18,335.

Supports: 18,225, 18,190

Resistances: 18,340, 18,400.

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