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Nifty 50 has been stuck between 23,200 and 23,400 since the beginning of the week. The index is now poised at the upper end of the range. It is currently trading at 23,398, up 0.57 per cent. The advances-declines ratio is at 37:13. This is a positive sign.
Nifty 50 outlook
The bias looks positive on the charts. As such there’s a high chance the Nifty may breach 23,400 today. Such a break can take it to 23,550.
Nifty must decline below 23,200 to come under pressure. If that happens, then it could fall to 23,000 or 22,800. However, that appears less likely at the moment.
Nifty 50 Futures
The Nifty 50 June Futures (23,422) is up about 0.5 per cent. Resistance is around 23,500. The contract has to break above this to strengthen the bullish momentum. Only then will a rise to 23,600 and higher come into picture.
Failure to breach 23,500 and a turnaround from there can drag the Nifty 50 June Futures contract down to 23,300-23,250.
Trade strategy
Traders can wait for the contract to breakout above 23,500 and then go long. Keep a stop-loss at 23,470. Trail the stop-loss up to 23,520 as soon as the contract moves up to 23,545. Move the stop-loss further up to 23,555 when the contract touches 23,570. Exit the long positions at 23,580.
Supports: 23,300, 23,250
Resistances: 23,500, 23,600
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