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The Nifty futures contract is trading weak. It opened gap down at 7,870 and then recorded a high of 7,909.9.
However, the contract failed to sustain the up move and reversed lower. Key intra-day resistances are at 7,900 and 7,935. The outlook for the Nifty contract is bearish and it is likely to trade below 7,900 today.
Traders can go short at current levels, with a stop-loss at 7,920 for the target of 7,830.
Immediate support for the contract is at 7,845. But the sharp reversal from the day’s high at 7,909 has increased the probability of a fall below this support level. Such a break can take the contract lower to its next support at 7,822.
The downtrend will reverse only on a strong move above 7,900. The contract can then target 7,935. But such an up move looks unlikely.
Strategy : Go short with a stop-loss at 7,920
Supports : 7,845, 7822
Resistances : 7,900, 7,935
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