CNX-Bank Index-Technical View---27-1-2015

CNX-Bank Index closed at 20072.70 on 23-1-2015

SUPPORT: - 19788 / 19723 / 19166 / 19061.35 / 18923.60 / 18875.45 / 18736.66 / 18728.20 / 18517.90 / 18428.

RESISTANCE: - 20170 / 20460 / 20710 / 21097.

(Figures in bold are important)

Index opened with a huge gap up at 20133.85 and almost filled the gap during the day and made a low of 19967.35 and thereafter it moved up and made a new all time  high of 20167.65 and closed the weekend at 20072.70.Today was the 5^th straight day of rise   and with each passing up day its vulnerability for correction is increasing, therefore I once again caution trader to be highly alert in long trade and handle it with extreme vigil and promptness because it may encounter severe profit booking anytime. It seems that this on- going up rally may get exhausted and take a  breather in the range of 20460—20700 and since we are not far away from striking this range ,I would therefore advice to book profit on existing long trades on every rise and avoid fresh long trade for at least 2-3 days.

The aggressive trader can still go long above 20080 and 20170 with a stop loss of below 20040 & 20130 for 27-1-2015 but should avoid fresh long trade if it consistently starts trading below 20040 because then correction may set in. I once again repeat to avoid fresh long trade for at least 2-3 days, because of over optimism and exuberance prevailing in the market for the last couple of trading sessions which is a distinct indication of a top for now is nearby.

Going up it will resistance at 20170 / 20460 & 20710 and moving down it will have support at 19788 / 19723 /19166 / 19061 / 18923 & 18728.

Kindly note that profit should also be booked in trade from time to time at the appropriate points so that you can take advantage of the market swings.

REMARK:- Long term up trend is still intact. It is still buy on dip market but I would suggest to avoid fresh long trade here instead it is suggested to book profit on existing long trades on every rise because we are not far away from the expected exhaustion range.

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.

Disclaimer:-The view expressed here are solely of the author and he is not at all responsible in any way for the outcome of the trade you enter based on the above view.

Note: Price stated here is of spot market.

Contact me for strategic guidance to enter and exit the trade.