Indian benchmark indices are getting some relief today. Both the Sensex and Nifty 50 are trading in the green. Sensex is at 53,944, up 0.98 per cent. Nifty is up 0.84 per cent, trading at 16,147. Nifty has resistance at 16,175 and 16,225. Sensex has immediate resistance at 54,000 and 54,500. The broader bias is negative, and the resistances mentioned are likely to cap the upside from there. A pullback from the resistances can trigger a fresh fall and keep the broader downtrend intact.
Asian indices are trading mixed. Nikkei 225 (24,906) is up 0.48 per cent. But Shanghai Composite (3,233), Hang Seng (20,287) and Kospi (2,622) are down sharply in the range of 1-2.3 per cent.
In the US, the Dow Jones Industrial Average (32,632) fell sharply from the day’s high of 33,402.98 to close lower by 0.56 per cent. Inability to sustain above 33,000 keeps the bias bearish to test 32,000 on the downside.
Futures: The Nifty 50 March Futures (16,138) is up 0.6 per cent. An important intraday support is at 16,080. A break below it can drag the contract down to 15,900 initially. A further break below 15,900 will see the fall extending to 15,700.
Traders can go short on a break below 16,080. Stop-loss can be placed at 16,220. Trail the stop-loss down to 15,980 as soon as the contract falls to 15,870. Move the stop-loss further down to 15,860 as soon as the contract touches 15,790. Book profits at 15,720.
In case the Nifty 50 March futures contract sustains above 16,080 and breaches 16,200, an extended corrective rise to 16,400 is possible.
Trading strategy: Go short on a break below 16,080. Keep the stop-loss at 16,220 for the target of 15,720. Trail the stop-loss down to 15,980 as soon as the contract falls to 15,870. Move the stop-loss further down to 15,860 as soon as the contract touches 15,790.
Supports: 16,090 and 15,900
Resistances: 16,200 and 16,400