Nifty 50, the benchmark index, opened today’s session lower at 23,488 versus previous close of 23,519. The index dropped further and is trading at 23,360, down 0.7 per cent by the end of the first hour of trade.
The advance/decline ratio of Nifty 50 stands at 12/38. Infosys, up 0.9 per cent, is the top gainer whereas Adani Enterprises, down 15 per cent, is the top gainer.
In line with the benchmark index, all mid and small cap indices are in the red. Likewise, barring Nifty IT (up 0.5 per cent), all other sectors are down so far today. Nifty PSU Bank and Nifty Metal, down 4.3 per cent and 2.2 per cent respectively, are the top losers.
Nifty 50 futures
The November futures of Nifty 50 began the session lower at 23,461 versus Tuesday’s close of 23,535. It is now hovering around 23,370, down about 0.7 per cent.
The price action shows strong downward momentum, and the likelihood of a fall is high. The contract is likely to drop to 23,100 over the next few sessions. The price region of 23,000-23,100 is a good base against which there can be a rally.
On the other hand, if Nifty futures rally from the current level, it will face a barrier at 23,600 and 23,850. Only a breach of 23,850 can lead to a sustainable rally. Until then, the bears will be at an advantage.
Trading strategy
Short Nifty futures at 23,370 and on a rally to 23,500. Place stop-loss at 23,650. When the contract slips below 23,200, revise the stop-loss to 23,325. Book profits at 23,100.
Supports: 23,100 and 23,000
Resistance: 23,600 and 23,850