Comments
The Indian benchmark indices – the Nifty 50 (18,220) and the Sensex (61,230) – opened today’s session marginally lower compared to yesterday’s close. Yet, post opening, both indices have risen and are now up by 0.15 per cent each.
The Asian market looks mixed. While Hang Seng (20,045) is up by 1.3 per cent, ASX 200 (6,950) has lost 1.2 per cent. KOSPI (2,225) is trading flat. So, we cannot expect a definite impact by the Asian market on the domestic market.
The market breadth of the Nifty 50 is showing a positive bias as the advance/decline ratio stands at 31/19. Broader market mood also appears positive as all the mid- and small-cap indices are in the green. Barring the Nifty Metal (down by 0.35 per cent) and Media (down by 0.2 per cent), all other sectors have gained today. The Nifty PSU Bank, up by 1.4 per cent, is the top performer.
Nifty 50 futures
The January futures of the Nifty 50 index opened gap-down at 18,235 versus yesterday’s close of 18,276. But then, it has now recovered to 18,290.
The price action since the final week of December shows that the contract has been forming higher highs and higher lows. Besides, it has rebounded from a rising trendline support at 18,220. The price action hints at a rally to 18,450. If this level is breached, it can move up further to 18,500.
On the other hand, if the contract falls and slips below the support at 18,200, it can turn the trend bearish. In such a case, the contract can decline to 18,100.
Trading strategy
Given the broader positive bias, traders can buy Nifty futures at the current level of 18,290. Add more longs if the price dips to 18,250. Place stop-loss at 18,180.
When the contract rallies past 18,340, modify the stop-loss to 18,250. Further, when the contract moves above 18,400, tighten the stop-loss to 18,340. Exit the longs at 18,450.
Note that the above trade recommendations are for intraday. So, exit the positions by the end of the day if either target or stop-loss levels are not hit.
Supports: 18,200 and 18,100
Resistance: 18,340 and 18,450
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.