Technical Analysis

Nifty Call: Go short in intra-day rallies with a fixed stop-loss at 11,655 levels

Yoganand D, BL Research Bureau | Updated on September 04, 2018 Published on September 04, 2018

Nifty 50 September Futures (11,613)

Taking mixed cues from global markets, the Sensex and the Nifty started the session on a flat note and soon declined into the negative territory. Subsequently, both the benchmark indices began to trade sideways in a narrow range.

Asian markets were mixed, the Nikkei 225 index was down at 22,696 levels, while Hang Seng index surged 221 points or 0.8 per cent to 27,933 levels. On the domestic front, the Nifty index is hovering in the negative zone, while the Sensex is marginally trading in the positive area.

The market breadth of the Nifty is biased towards declines. The India VIX climbed 1 per cent to 13.53 levels. Overall, the near-term outlook is negative.

The Nifty September month futures started the session down at 11,633. Following an initial decline, the contract recorded an intra-day low of 11,578 and began to recover. The contract has marked an intra-day high of 11,649. 

Although, the contract has recovered from the intra-day low, the near-term stance is bearish. Traders can make use of intra-day rallies to initiate fresh short positions while maintaining a fixed stop-loss at 11,655 levels.

A fall below the immediate support at 11,600 can drag the contract down to 11,580 and then to 11,550 levels. Next key supports below 11,550 are placed at 11,530 and 11,500. On the upside, a decisive rally beyond 11,650 can take the contract higher to 11,675 and 11,700 levels.

Strategy: Go short in intra-day rallies with a fixed stop-loss at 11,655 levels.

Supports: 11,600 and 11,580

Resistances: 11,650 and 11,675

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