Nifty futures (21,820)

Nifty 50 opened today’s session with a considerable gap-down at 21,647.25 versus yesterday’s close of 22,032.30. The index is now trading around 21,825, down 0.9 per cent.

Supporting the bearish bias, the advance/decline ratio of Nifty 50 stands at 20/30. Like the benchmark indices, all mid- and small-cap indices are in the red.

Among the sectors, Nifty Media, up 1.3 per cent, is the best performer among the very few gainers. Nifty Bank, down 2.3 per cent, is the top loser.

Nifty 50 futures

The January futures contract of Nifty 50 opened today’s session lower at 21,743.70 versus yesterday’s close of 22,029.50. It is now trading at 21,820, down nearly 1 per cent.

The current level of 21,820 is a support. Just below this lies the 20-day moving average at 21,750. Therefore, the price band of 21,750-21,820 is a support band.

If there is rebound on the back of the above-mentioned support region, Nifty futures could recover to 22,000, its nearest hurdle. Subsequent intraday resistance is at 22,200.

But if Nifty futures slip below 21,750, we could see another leg of downtrend, where the price could fall to 21,580 or even to 21,500.

Trading strategy

Since the intraday trend appears bearish, one can short Nifty futures now at 21,820. Add shorts if it rises to 21,880. Place stop-loss at 21,950. Exit at 21,580.

Supports: 21,820 and 21,580

Resistances: 22,000 and 22,200

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