Technical Analysis

Nifty Call : Make use of intra-day rallies to go short with a stop-loss at 11,260 levels

Yoganand D | Updated on May 16, 2019 Published on May 15, 2019

Nifty 50 May Futures (11,232)

Taking positive cues from the global markets, the domestic benchmark indices began the session in green, with a gap-up open. The Nikkei 225 has surged 0.58 per cent to 21,188 and the Hang Seng index has gained 0.9 per cent to 28,375 in today's session. The Sensex and the Nifty started the session in positive territory and continue to hover with a negative bias. Both the key benchmark indices are witnessing selling pressure at higher levels. The market breadth of the Nifty index is biased towards declines. The India VIX has gained 1.2 per cent to 27.45 levels.

The Nifty futures contract started the session with a gap-up open at 11,275. After an initial rally, the contract encountered key resistance at 11,300 and began the decline on the back of selling pressure. The near-term stance will remain bearish as long as the contract trades below 11,250 levels. Traders can make use of intra-day rallies to go short with a stop-loss at 11,260 levels. A decisive fall below the immediate support at 11,200 can drag the contract down to 11,175 and 11,150 levels. On the other hand, a conclusive rally above the key resistance at 11,250 can experience a corrective rally to 11,275 and 11,300 levels. To strengthen the bullish momentum, the contract needs to decisively breach the key resistance at 11,300. Next resistances are at 11,325 and 11,350 levels.

Strategy: Make use of intra-day rallies to go short with a stop-loss at 11,260 levels

Supports: 11,200 and 11,175

Resistances: 11,250 and 11,275

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