Technical Analysis

Nifty Call: Go short with a stop-loss at 10,835

Gurumurthy K, BL Research Bureau | Updated on January 11, 2019 Published on January 11, 2019

Nifty 50 January Futures (10,811)

The Nifty 50 futures contract has been stuck in a sideways range between 10,750 and 10,900 since the beginning of this week. Within this range, the contract made a high of 10,886 and has come-off sharply from there. It is currently hovering above the psychological level of 10,800. Immediate resistance is in the 10,820-10,830 region.

If the contract breaks above 10,830, an upmove to 10,880 and 10,900 is possible. But as long as the contract trades below 10,830, it can break below 10,800. Such a break can drag the index futures lower to 10,750 -the lower end of the range.

A strong break below 10,750 will turn the outlook bearish and will increase the likelihood of the contract tumbling towards 10,700 or even lower thereafter.

Short-term traders with high risk appetite can go short at current levels. Stop-loss can be placed at 10,835 for the target of 10,760. Revise the stop-loss lower to 10,795 as soon as the contract moves down to 10,780 

Strategy: Go short at current levels with a stop-loss at 10,835

Supports: 10,800, 10,750

Resistances: 10,830, 10,880

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