Nifty 50 opened today’s session with a gap-up at 24,636 versus Friday’s close of 24,541. The index moderated a bit and is currently hovering around 24,580, up 0.1 per cent.

The advance/decline ratio stands at 34/16, giving the domestic benchmark index a positive bias.

All mid- and small-cap indices are in the green. Among the sectors, barring Nifty Auto, down about 0.2 per cent, is the only index that is down at the end of the initial hour of trades

Nifty PSU Bank and Nifty Oil & Gas, up 2.2 and 1.8 per cent, respectively, are the leaders among the sectors.

That said, the Asian equity market appears mixed. Among the major equity indices Nikkei 225 (37,715) and KOSPI (2,690) are down 1 and 0.3 per cent respectively. Whereas ASX 200 (7,980) and Hang Seng (17,615) are up 0.2 and 1 per cent respectively.  

Nifty 50 futures

The August futures of Nifty 50 rallied past key levels at 24,450 and 24,500 last week. Following this, it opened higher at 24,640 today versus last week’s close of 24,586. The contract is now hovering around 24,610, up 0.1 per cent.

Although the price action shows a positive outlook, there is a chance for Nifty futures to witness a dip, possibly to 24,480, before the next leg of upswing. But it the contract surpasses 24,675, it can rally for the rest of the day. On the upside, the contract can soon touch 25,000.

On the other hand, if the contract slips below the support at 24,450, it can extend the downswing to 24,300. A breach of this can drag Nifty futures to 24,150.

Given the prevailing conditions, traders can wait and then initiate longs.

Trading strategy

Buy Nifty futures if it declines to 24,480. Place a stop-loss at 24,300. When the contract rises above 24,675, revise the stop-loss to 24,550. Book profits at 25,000.

In case the contract surpasses 24,675 without a decline from here, traders can buy with a stop-loss at 24,550. Exit at 25,000.

A move up to 25,000 can happen over the course of the week.

Supports: 24,500 and 24,300

Resistances: 25,000 and 25,200

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