Nifty futures have been weak since 23 Jan 2020, and they are in the selling zone currently, and they lose ground rapidly. Gains made in 5-10 days can be lost in 1-2 days. The weekly chart shows clear weakness, with falling momentum. Nifty futures have support at 11,700 but we can’t be sure it will hold.
The 10 week SMA on the weekly chart has started curving down, and it takes several weeks of correction and consolidation to get back into an uptrend. We should not expect any support from the 50 week SMA because it has not worked in the past. So it looks like Nifty can see 300-500 points correction before a new uptrend.
Nifty Futures have moved up rapidly in the last one week after crossing 11,600 level. This upmove has been made using gap ups with truncated weeks due to market holidays. So this entire price range between 11,600 and 11,900 needs to be retested for any reliable upmove above 12,000.
Nifty Futures Technical Analysis Nifty Futures are currently at the top end of the Bolliger Bands range, and far above their short term moving averages of 5 and 10 days. Nifty Futures have major resistance at 11,950 and 12,060. The momentum has been going down, while price has been going up. So there is a good chance of 100-200 point correction in the next 1 week, before further upmove towards 12,000 because there will be major resistance and selling pressure at the higher levels.
Nifty Futures Trading Strategy: Investors can create long positions on corrections, as long as Nifty futures are above the 200 day moving average of 11,380. Nifty has been making big sharp moves on upside and downside since July 2019, and any reliable Nifty futures trading needs 100-200 point stop loss. Trading with 10 day moving average as the stop loss is also a good approach in such conditions.