Nifty 50 October Futures (26,145)
Nifty has begun the week on a negative note. The index is trading below 26,000 and is currently at 26,975, down 0.78 per cent. The advances/declines ratio is at 15:35. This is negative. If this sustains, Nifty can fall more during the day.
Nifty 50 Outlook
Nifty (26,975) has strong support in the 25,920-25,900 region which can be tested during the day. We expect the Nifty to sustain above 25,900 and bounce back again. Such a bounce from around 25,900 can take the Nifty up to 26,200 again in the coming sessions.
Nifty will come under more selling pressure only if it declines below 25,900. If that happens, the fall extend to 25,800 and lower.
Nifty 50 Futures
The Nifty 50 October Futures (26,145) is down 0.76 per cent. The intraday picture is weak. Strong resistance is in the 26,250-26,300 region. As long as the contract trades below 26,300 the outlook will remain negative. The Nifty 50 October Futures contract can fall to 26,000-25,950 from here.
But after this fall, the contract can see a fresh rise which can take it up to 26,300 and higher in the coming days.
The contract will come under more pressure if it declines below 25,950. In that case, the contract can fall to 25,700 going forward.
Trade Strategy
Broadly there is a range of 26,000/25,950 to 26,300. Within this the contract is now at the middle of the range. Considering the risk/reward ratio, we suggest traders to stay out of the market now.
However, dips can be bought. Positional trades with a holding period of one week can be considered.
Go long at 26,040 and 25,980. Keep the stop-loss at 25,870. Trail the stop-loss up to 26,120 as soon as the contract moves up to 26,180. Move the stop-loss further up to 26,160 when the contract touches 26,220. Exit the longs at 26,300.
Supports: 26,000, 25,950
Resistances: 26,300, 26,400