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Nifty 50 May Futures (10,685)
The Nifty 50 futures contract seems to be lacking strength. Although the contract opened with a 20-point gap-up at 10,680, it has failed to breach the psychological level of 10,700.
The contract made a high of 10,695.8 and has come-off slightly from there. It is currently stuck in between the support at 10,670 and resistance at 10,700. A breakout on either side of 10,670 or 10,700 will decide the next move.
A strong break above 10,700 will ease the downside pressure. Such a break can take the contract higher to 10,740.
On the other hand, if the index futures decline below 10,670, it can come under renewed pressure. A fall to 10,640 is possible in such a scenario. A break below 10,640 will then increase the likelihood of the contract tumbling to 10,600.
Traders with high risk appetite can short on a break below 10,670. Stop-loss can be placed at 10,695 for the target of 10,625. Revise the stop-loss lower to 10,655 as soon as the contract moves down to 10,645.
Strategy : Go short on a break below 10,670 with a stop-loss at 10,695
Supports : 10,670, 10,640
Resistances : 10,700, 10,740
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