Nifty’s prediction for October 25, 2022: Go for longs

The Indian market has opened green after positive signals from Asia. However, gains were abandoned as the Nifty 50 (17,740) and Sensex (59,850) pulled back from a gaping open and are now trading nearly flat compared to yesterday’s closing price. But Monday’s session was short and both indices are up significantly from last week’s close.

Among the Asian majors, Nikkei 225 (27,295), Hang Seng (15,300), ASX 200 (6,792) and KOSPI (2,244) are between 0.4 and 1.3 percent so far. That’s why the stock market is bullish today.

Looking at the Nifty 50’s market breadth, there is a positive bias as the advance/fall ratio is now 28/22. But the mid- and small-cap indices are marginally in the red, losing between 0.1 and 0.25 percent.

Among sector trading, Nifty Metal is the best-performing index to date, up 1.5 percent, while Nifty PSU Bank is the weakest index, down 0.55 percent.

Nevertheless, the benchmark is likely to gain further ground from here on out, although there is a possibility of a small decline from current levels.

Handy 50 Futures

The Nifty 50 index’s October futures opened today’s session higher at 17,772 from yesterday’s close at 17,732. It is currently trading at 17,750 and there are good chances for the contract to rise from here.

But there could be a drop to 17,680. Overall, we expect Nifty futures to rise from the current level of 17,750 or after a dip to 17,680. We expect the contract to hit 18,000 in the coming sessions.

However, keep in mind that crossing 17,680 means the drop could reach 17,500.

Trading Strategy

Go long on Nifty futures at the current level of 17,750. Add more longs in case there is a dip to 17,680. Place stop loss at 17,615.

When the contract rises past 17,800, shift the stop-loss to 17,680. Tighten the stop-loss further by 17,780 when the price moves above 17,900. Leave the longs at 18,000.

Supports: 17,680 and 17,500

Resistance: 17,880 and 18,000

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Published on October 25, 2022

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