Nifty Call: Go short on rallies at 10,760, with a stop-loss at 10,790

Nifty 50 May Futures (10,735)

The Nifty 50 futures contract continues to trade under pressure. The intraday price action since Wednesday gives a clear indication that the contract lacks fresh buyers to take it decisively above 10,800. It also indicates that strong selling interest is emerging at higher levels of around 10,800.

As long as the contract manages to sustain above 10,700, a range-bound move between 10,700 and 10,800 is possible for some time.

However, the possibility of the contract breaking below 10,700 eventually is high. Such a break can drag the index futures lower to 10,650 or 10,630.

Short-term traders can make use of rallies to go short at 10,760. Stop-loss can be placed at 10,790 for a target of 10,700. Revise the stop-loss lower to 10,745 as soon as the contract moves down to 10,730.

Key resistances are placed at 10,785 and 10,815. The downside pressure will ease only if the contract breaks above 10,815 decisively. But such a break looks unlikely at the moment.

Strategy: Go short on rallies at 10,760, with a stop-loss at 10,790

Supports: 10,720, 10,650

Resistances: 10,785, 10,815



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