Nifty 50 continues to extend its run up today as well. It began today’s session with a gap-up at 20,808.90 versus yesterday’s close of 20,686.80. The index is now at 20,800, up 0.5 per cent at the end of the first hour of trade.
The breadth of Nifty 50 is giving it a bullish inclination – the advance/decline ratio stands at 32/18. All mid- and small-cap indices too are in the green today. Besides, barring Nifty IT, down 0.7 per cent, all other sectors have gained.
Nifty PSU bank index, up 1.9 per cent, is the top gainer followed by Nifty Bank which has advanced 1.2 per cent powered by the public sector banks.
Nifty 50 futures
The December futures contract of Nifty 50 opened today’s session with a gap-up at 20,855.05 as against yesterday’s close of 20,798.90. It is now trading at 20,920, up 0.6 per cent.
The contract will most likely rally to 21,000 today. A breach of this will open the door for another leg of uptrend to 21,100.
On the other hand, if Nifty futures see a decline from the current level, the nearest support levels it can find are at 20,800 and 20,700.
Overall, the trend is bullish and so, if there is a fall in price, it is likely to be limited.
Trading strategy
Buy Nifty futures at the current level of 20,920. Add longs in case the price dips to 20,850. Place stop-loss at 20,800.
When the contract goes past 21,000, tighten the stop-loss to 20,940. Book profits at 21,080.
Note that this trade recommendation is for intraday. So, exit the position at the end of the session irrespective of where Nifty futures is trading at.
Supports: 20,800 and 20,700
Resistance: 21,000 and 21,100