CNX-Bank Index-Technical View-For the week Starting From-25-8-14

CNX-Bank Index closed at 15819.15on 22-8-2014

Range for the week ended 22-8-14 was :-15865.30---15068.35

SUPPORT: - 15742.05 /15725.80 / 15626.90 /  15592.80 / 15568.05 / 15499.70 / 15267.60 / 15137.60 15089 / 14933  / 14858.90 / 14857.50/ 14709.30 / 14709.10 / 

RESISTANCE: - 15865.30 /   15930 / 16308 /.

  (Figures in bold are important)

Index opened on a flat  note for the week under review and made a low of 15068.35 and thereafter steadily moved up and crossed the previous all time high of 15742.05 and made new all time high of 15865.30 before closing the week near the high  at 15819.15.The entire week’s movement exhibited tremendous strength in it. therefore I suggest to adopt buy on dip strategy. 

TECHNICAL VIEW

1.      ON DAILY CHART:- It looks good on the daily chart furthermore it is has decisively moved above the upper band of short term DMA range on 18-8-14 and sustaining it, the range of short term DMA is between 15437—15250(it changes every day) for 25-8-14, therefore as of now it is buy on dip market but be alert in long call  if it starts trading below 15437 and get out of the long trade if closes below 15250. Going up it will face tough resistance at 15940 / 16200 / 16413 & 16580.

2.      ON WEEKLY CHART:- It is ok on the chart . Furthermore it is way above  the upper band of the short term DMA range which is between 15206--14617(for the next week) starting from-25-8-14

The strong negative divergence are still there and if it comes into play then it could take index down to 14447.20,12842 &12551 levels but as I always say that divergence should be viewed in sync with the moving average placements and since index is decisively above the upper band of the short term DMA on the daily chart as well as on the weekly chart, therefore negative divergence will take a back seat as of now till it breaks the short term DMA range lower band  at least on the daily chart again. 

 REMARK:- Long term trend is still up, therefore I would suggest  to adopt buy on dip strategy at appropriate level with proper stop loss.

Kindly note that make your cost your stop loss in favorable trade and then trail it as the price move up/down to gain maximum profit and avoid losses. Use support and resistance levels as entry, exit, target and trailing stop loss points. DO NOT TRADE WITHOUT STOP LOSS

Note: Price stated here is of spot market

Contact me for strategic guidance to enter and exit the trade