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Nifty 50 March Futures (22,420)
Nifty50 is trading lower, tracking cues from the overnight fall in the Dow Jones Industrial Average. The index is trading at 22,306, down 0.22 per cent.
Nifty has been falling since the beginning of this week. However, the price action indicates that the fall has been gradual, signalling lack of strong sellers in the market. It also keeps alive the chances of rising back sharply.
Nifty 50 outlook
Key intraday resistance is around 22,350. As long as the Nifty stays below this resistance, intraday outlook will remain negative. The chances are high for the Nifty to come down gradually towards 22,200-22,150 in the coming sessions.
A strong break and a sustained rise above 22,350 is needed to strengthen the case for a rise to 22,500 and 22,700-22,800.
Global indices
Asian markets are trading mixed. Nikkei 225 (40,086) and Kospi (2,646) are down 0.09 and 0.19 per cent, respectively. Hang Seng (16,539) and Shanghai Composite (3,051) are up 2.33 and 0.12 per cent, respectively.
The Dow Jones in the US declined sharply on Tuesday. The index had tumbled over a per cent breaking below the key support level of 38,800, leaving the outlook negative for the index. We can expect the Dow Jones to extend the fall up to 38,000 and even lower in the coming days.
Nifty 50 Futures
The Nifty 50 March Futures (22,420) is trading flat. The contract fell to a low of 22,350 and is bouncing back from there. On the charts, the intraday outlook is mixed. Resistances are at 22,450 and 22,500. Support is at 22,350. Broadly, we can expect the Nifty 50 March Futures contract to oscillate in a range of 22,350 to 22,500 during the day.
A break out on either side of 22,350 or 22,500 will determine whether the contract can fall to 22,300-22,250 or rise to 22,550-22,600.
We expect the contract to break 22,350 and fall in the coming sessions.
Trade Strategy
Since the contract can oscillate in a sideways range, we suggest traders to stay out of the market. Wait for the range to breakout and take trades accordingly.
Supports: 22,350, 22,300
Resistances: 22,450, 22,500
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