Nifty’s outlook for March 20, 2023: Go short now, and at 16,970

Nifty 50 March Futures (16,934)

Nifty 50 and Sensex have opened the week on a weak note. Both the indices are down 1.2 per cent each. Nifty is trading at 16,895 and Sensex at 57,302. High risk aversion in the market is keeping the benchmark indices under pressure.

Nifty has an important support at 16,850. A break below it can drag it further to 16,600-16,500 in the coming days. The price action around 16,850 will need a close watch.

Global indices

Barring the Shanghai Composite (3,254), up 0.12 per cent, the other major Asian indices are in red. Hang Seng (19,019) has been beaten down the most. The index is down 2.5 per cent. Nikkei 225 (27,015) is down 1.17 per cent.

Read also: Stocks that will see action on March 20, 2023

In the US, the Dow Jones Industrial Average (31,861.98) fell 1.19 per cent on Friday. It looks vulnerable to test 31,000 before a fresh rise happens.

Nifty 50 Futures

The Nifty 50 March Futures (16,934) is down 1.4 per cent. It has declined below the key support level of 16,970. As long as the contract trades below 16,970 the outlook is weak to see a fall to 16,800-16,750.

Only a strong break above 16,970 will ease the downside pressure and take the contract up to 17,050-17,100.

Trading Strategy

Traders can go short now. Accumulate shorts at 16,960. Keep the stop-loss at 16,990. Trail the stop-loss down to 16,910 as soon as the contract falls to 16,890. Move the stop-loss further down to 16,880 when the contract touches 16,865 on the downside. Exit the shorts at 16,850.

Supports: 16,910, 16,850

Resistances: 16,970, 17,050.

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