Intraday NIFTY Futures trading based on Nifty Spot levels

General
1

I use Technical Analysis to place buy/sell orders on current month NIFTY futures. Should i place my trades on the basis of price chart of NIFTY future (derivative) or NIFTY Spot (underlying) ??

Eg. If am watching NIFTY future chart, price breaks 8200 level and stalls at 8214 but its a clean break of 8200 level on upside. But NIFTY spot stalled around 8198-8205, which makes it a breakout failure.

Which chart should be my preference?? Should i just watch both charts??

One problem with using NIFTY spot to place orders on NIFTY futures is placement of target and stop. NIFTY futures has its own levels but sometimes NIFTY Spot makes more senseā€¦but overall it gets overwhelming and confusingā€¦

So what do experienced traders suggest ???

2

It is best to watch both the charts. Theoretically you should be following the underlying charts, but practically futures determine where the spot is going to. So if you had to select one, it is best to select futures.

1 Like
3

Nifty spot and futures are actually the sameā€¦ only nifty futures is based on nifty spot. so, better to watch both charts.