Nifty 50 May Futures (10,657)

Taking bearish cues from the Asian markets, the Nifty and the Sensex started the session in  the red. Although, the benchmark indices bounced up into the positive territory, it failed to sustain due to selling pressure at higher levels.

Both the indices have again slipped into the negative territory. The Nikkei 225 has declined 0.55 per cent to 22,358 levels and Hang Seng Index has fallen 0.85 per cent to 30,530 levels.

The Nifty May futures contract began the session in the negative territory, opening at 10,664.9 levels. Taking support at 10,653, the contract witnessed an initial rally to a key resistance level of 10,700.

However, the contract changed direction and has entered the negative zone after testing the resistance at 10,700, on the back on selling pressure as well as profit-taking at this juncture.

The index futures is trading at about 13 points discount to the underlying Nifty index. On the downside, a key support at around 10,650 is providing base for the contract.

Traders with a short-term perspective should tread with caution as long as the index futures trade in the band between 10,650 and 10,675 levels.

A strong up move beyond 10,675 can push the contract higher to 10,700 again. A decisive breakthrough of 10,700 is required to strengthen the bullish momentum and take it higher to 10,725 and 10,750 levels.

Conversely, if the contract breaks below 10,650 levels, then it can decline to 10,630 and 10,600 levels. In that case, consider initiating fresh short positions with a fixed stop-loss.

Strategy : Range-bound movement is witnessed. Desist trading as long as the contract trades between 10,650 and 10,675 levels.

Supports : 10,650 and 10,630

Resistances : 10,700 and 10,725

 

 

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