Nifty 50 June Futures (10,725)

Negative global cues have triggered a gap-down open in domestic indices. In US markets, the Dow Jones futures tumbled more than 300 points to 24,692 and S&P dropped 30 points to 2,749 levels.

The Nikkei 225 tumbled 1.8 per cent or 400 points to 22,278 levels and Hang Seng Index declined 2.7 per cent or 806 points to 29,502 levels in today's session.

Following the gap-down open, the domestic bellwether indices continued to feature in the negative territory. The Nifty June futures contract also began the session with a gap-down start, opening at 10,760. This level is also the intra-day high and the contract continued to decline breaching a key support at 10,750 levels.

The contract has marked an intra-day low at 10,718 and trades just above this level with a negative bias. The market breadth of the Nifty index is biased towards declines.

The contract has fallen 0.6 per cent and continues to trade at a discount to the underlying value. The near-term outlook is bearish for the contract.

Traders can make use of intra-day rallies to sell the contract with a stop-loss at 10,755 levels. The contract can extend its decline and test support at 10,718 and 10,700 levels. Further, slump below 10,700 can drag the contract down to 10,675 and 10,650 levels in the near term.

Key resistances are at 10,750 and 10,775. A strong rally beyond 10,775 can bring back bullish momentum and take the contract higher to 10,790 or 10,800 levels. Significant resistances above 10,800 are at 10,825 and 10,850 levels.

Strategy : Make use of intra-day rallies to go short with a tight stop-loss at 10,755 levels.

Supports : 10,718 and 10,700

Resistances : 10,850 and 10,750

 

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