After gaining over 0.2 per cent in early trade, equity benchmarks Nifty 50 (19,435) and Sensex (65,600) gave up the gains. The indices are now trading near yesterday’s closing levels.
On the other hand, mid- and small-cap indices are in green. For instance, Midcap 50 and Smallcap 50 have gained 0.15 per cent and 0.7 per cent, respectively.
The frontline stocks seem to be facing downward pressure.
The advance/decline ratio of Nifty 50 stands at 22/8, indicating a bearish bias.
Among the sectors, Nifty PSU Bank index, up by 0.6 per cent, is the top gainer whereas Nifty IT, down by 0.7 per cent, is the top loser.
Nifty 50 futures
The July futures contract of Nifty 50 opened today’s session slightly higher at 19,535 versus yesterday’s close of 19,501. It is currently hovering around 19,500.
The chart shows that the contract is now trading in a range i.e., between 19,380 and 19,550. The direction of the contract will remain uncertain until any of these two are breached.
A breakout of 19,550 can open the door for a quick rally to 19,600. The upside could even extend to 19,700. On the other hand, if Nifty futures break below the support at 19,380, the price could fall to 19,300 or even to 19,200.
Trading strategy
Nifty futures, trading around 19,500, is near the range top (19,550).
It may be noted that only a breach of the 19,550-levels will give strength to the bulls.
Therefore, stay on the fence for now and go long if the resistance at 19,550 is breached. Place stop-loss at 19,480. When the contract touches 19,650, tighten the stop-loss to 19,600. Book profits at 19,700.
Supports: 19,380 and 19,300
Resistances: 19,600 and 19,700