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Nifty 50 and Sensex are under pressure. The indices are trading lower by about 0.4 per cent each. Sensex is at 65,435 and Nifty is trading at 19,465.
Nifty is continuing to face strong resistance in the 19,600-19,700 region. This leaves the chances high for the index to fall to 19,300 and even lower in the coming sessions.
Global indices
In Asia, barring the Nikkei 225 (32,473), up 0.84 per cent, other major indices are in red. Shanghai Composite (3,215), down 1.2 per cent has been beaten down badly.
In the US, the Dow Jones Industrial Average (35,176.15) had come down sharply from its intraday high of 35,578.58 on Thursday. Thus, the index is still stuck in between its 35,000-35,600 range. A breakout on either side of this range will determine the next move.
Nifty 50 Futures
The Nifty 50 August Futures (19,530) is down 0.34 per cent. The contract has support around 19,500. So, it has to rise back sharply from here in order to move back up to 19,600 and higher and also to avoid a fall below 19,500.
A break below 19,500 will be bearish to see a test of 19,400 on the downside.
Trade Strategy
Traders can go short on a break below 19,500. Keep the stop-loss at 19,535. Trail the stop-loss down to 19,480 as soon as the contract falls to 19,460. Move the stop-loss further down to 19,455 when the contract touches 19,435 on the downside. Exit the short positions at 19,420.
Supports: 19,500, 19,400
Resistances: 19,560, 19,600
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