10 March 2016


The Nifty futures is trading on a negative note today. It opened with a huge gap-up at the day’s high of 7583. But the contract failed to sustain the rally and fell sharply breaching the psychological support level of 7500. Barometer index, the Sensex snapped six day of gains, amid weakness in their Asian  and European  peers, as investors booked profits at higher levels. The Sensex ended with a loss of 171 points at 24623. The BSE Sensex opened at 24815 touched an intra-day high of 24817 and low of 24471. The Nifty closed with a loss of 46 points at 7486. The Nifty opened at 7545 hitting a high of 7547 and low of 7447.
The market capped the winning streak as anxiety over ECB policy meet led to profit booking. The ECB is expected to provide a stimulus and as per the size of the QE, it will generate a positive impact in the sagging economy. Markets have always tested the direct bottom line recovery from the lower levels. A crucial level of 7,400 will be seen for the Nifty. If Nifty slips below that particular level, further downside can be seen.  Further, slight weakness is seen in the European peers and US markets which has hurt the sentiments. Possibility of a rate cut will dictate the trend in the future.
Immediate outlook is bearish. The fall can extend to test its next important supports at 7415 and 7400.
Short-term traders with high risk appetite can go short with a tight stop-loss at 7475 for the target of 7415.
A reversal from 7415-7400 supports can take the contract higher to 7450 and 7470 once again. But a strong break below 7400 will increase the downside pressure and the contract can fall to 7370. It can also extend its fall to 7330.
Strategy: Go short with a stop-loss at 7475
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Supports: 7450, 7400
Resistances: 7500, 7550

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