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Nifty July Futures (8,583)
Over the past five trading sessions, the Nifty futures contract has been testing a key resistance at 8,650 and having difficulty surpassing it. The contract started the session at 8,598 (which is also an intra-day high) and, witnessing selling pressure, began to decline. As long as the contract trades below 8,600 levels, the outlook will remain bearish.
Traders with a short-term perspective can consider selling the contract on rallies with a stop-loss at 8,610 levels. The contract can decline to 8,570 and then to 8,550 levels. A further fall below 8,550 is required to strengthen the down-move and drag the contract lower to 8,530 and 8,500 levels.
On the other hand, a strong rally above 8,600 would lead to a minor up-move to 8,630 and 8,650 levels. An emphatic breakthrough of 8,650 levels will reinforce the short-term uptrend and take the contract northwards to 8,700.
Strategy: Make use of rallies to initiate fresh short positions, while maintaining a fixed stop-loss at 8,610 levels.
Supports: 8,570 and 8,550
Resistances: 8,600 and 8,630
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