Nifty 50 March Futures (9,625)

The US market collapsed yesterday as the benchmark indices S&P 500 and Dow closed with a loss of about 10 per cent. Subsequent to this, the Asian markets tumbled earlier today, where the Nikkei lost 6 per cent and the Hang Seng is trading lower by nearly 4 per cent.

Following this, the Indian benchmarks opened with a huge gap-down and within a few minutes into trading, the lower circuit was triggered, as it hit 10 per cent on the downside. So, trading was halted for 45 minutes. After re-opening, the indices recovered sharply. Currently, the Nifty spot and the Sensex spot indices are up about a per cent each.

The market breadth of the Nifty 50 index has turned the bias towards bulls as 34 out of the 50 stocks are in the green. The mid-cap and small-cap indices too are recovering. Among the sectoral indices, the Nifty PSU bank index is the top gainer for now, up 7.1 per cent whereas the Nifty media index is the top loser, down 0.5 per cent. Notably, volatility is still at elevated levels. India VIX – the volatility index – is up a whopping 30 per cent to 53.5 levels, the highest level since 2009.

The March futures contract of the Nifty index opened extremely low at 8,939 versus the previous close of 9,546. The contract then declined sharply, registering a low of 8,299. After the duration of market halt, it has been rallying strongly and is currently trading at 9,625 after registering an intraday high of 9,674. For intraday, traders can buy the contract with stop-loss at 9,600 if it breaks out of 9,700.

Strategy : Buy the contract with stop-loss at 9,600 if it breaks out of 9,700

Supports : 9,500 and 9,370

Resistances : 9,750 and 9,830

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