Technical Analysis

Nifty Call : Outlook positive above 11,600; buy in dips

Yoganand D | Updated on July 16, 2019 Published on July 16, 2019

Nifty 50 July Futures (11,632)

The Sensex and the Nifty began the session on a flat note and immediately rose sharply and continued to trend upwards. The Asian markets are showing mixed cues, the Nikkei 225 is down 0.6 per cent to 21,550 levels, while the Hang Seng index has added 0.2 per cent to 28,619 levels.

Both the Sensex and the Nifty have advanced about 0.45 per cent. The market breadth of the Nifty index is biased towards advances. On the other hand, the India VIX, the volatility index has slumped 3 per cent to 11.61 levels.

Buying interest is seen in the Nifty realty index, which has jumped 2 per cent. Nifty Bank and FMCG have gained 0.5 and 0.8 per cent correspondingly.

The Nifty July month contract commenced the session on flat note, opening at 11,585 levels. After marking an intra-day low at 11,570 the contract resumed the up-move, breaking the key resistance at 11,600 which is a positive sign. The near-term outlook remains bullish as long as the contract trades above 11,600 levels. Traders can buy in declines while maintaining a fixed stop-loss at 11,600 levels.

Continuation of the up-move can test resistance at 11,650. A decisive rally above 11,650 can take the contract higher to 11,675 and then to 11,700 in the near term. Conversely, a strong plunge below 11,600 can bring back selling pressure and drag the contract down to 11,570 and then to 11,550 levels.

Strategy: The outlook stays positive above 11,600. Buy in dips

Supports: 11,600 and 11,570

Resistances: 11,650 and 11.675

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