Nifty 50 began today’s session at 25,402 versus yesterday’s close of 25,419. The index is now hovering around 25,430.

The advance/decline ratio stands at 33/17, giving the index a bullish bias. Hero MotoCorp, up 2.6 per cent, is the top gainer whereas Tech Mahindra, down 3.1 per cent, is the top loser.

Mid- and small-cap indices appear mixed. Nifty Financial Services, up 0.8 per cent, is the top performing sectoral index whereas Nifty IT, down 0.6 per cent, has lost the most.

Among the major Asian equity indices, Nikkei 225 (36,230), ASX 200 (8,135) and KOSPI (2,575) are trading flat. Hang Seng (17,660) has appreciated 1.4 per cent.

Nifty 50 futures

The September futures of Nifty 50 began the session at 25,445 versus yesterday’s close of 25,450. It is now hovering around 25,465.

The chart indicates that Nifty futures is set to establish a fresh leg of rally from the current level. The contract can rise to 25,800 before the end of this week. Note that the price band of 25,800-26,000 is a resistance.

But if Nifty futures declines and breaks below the support at 25,350, the short-term outlook will turn bearish.

Support below 25,350 is at 25,200 and 25,000.

Trading strategy

Buy Nifty futures now at 25,465 and add longs if the price dips to 25,400. Place initial stop-loss at 25,330.

When the contract rallies past 25,500, revise the stop-loss to 25,380. On a rally to 25,650, tighten the stop-loss further to 25,550. Exit at 25,800.

The potential rally to 25,800 might take two or three more sessions.

Supports: 25,350 and 25,200

Resistance: 25,800 and 26,000

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