Technical Analysis

Nifty Call: Go short with stop-loss at 11,410 levels

Yoganand D, BL Research Bureau | Updated on March 25, 2019 Published on March 25, 2019

Nifty 50 March Futures (11,376)

Tracking the bearish global cues, the domestic equity indices began the session with a gap-down open.

The Asian markets have slumped more than 2 per cent, the Nikkei 225 has tumbled 3 per cent to 20,977 levels and Hang Seng index has declined 2.2 per cent to 28,471 levels. Both the Sensex and the Nifty started the session with a gap-down open and continue to trade in the negative territory.

The market breadth of the Nifty index is biased towards declines. The India VIX has gained 1.7 per cent to 16.55 levels. All the secotral indices are witnessing selling interest and are featuring in the negative territory.

The Nifty March contract commenced the session with a large gap-down open at 11,419. Experiencing selling interest and profit taking the contract extended its decline, breaching a key support at 11,400. The contract has marked an intra-day low at 11,355 levels. As long as the contract trades below 11,400 levels, the near-term view is bearish.

Traders can make use of intra-day rallies to sell the contract while maintaining a stop-loss at 11,410. A strong fall below 11,355 can drag the contract down to 11,330 and then to 11,300 in the near term.

Key resistances above 11,400 are placed at 11,425 and 11,450 levels. A strong rally above 11,475 is needed to bring back bullish momentum and take the contract higher to 11,500 levels.

Strategy: Make use of rallies to go short with a stop-loss at 11,410 levels

Supports: 11,355 and 11,330

Resistances: 11,400 and 11,425

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