CNX-BANK NIFTY--A TECHNICAL VIEW---24-9-2015

CNX--BANK NIFTY

Closed  at 17255.30 on 23-9-15.

Support:--17246/17174/16980/16930/16707/16670/16484/16192/15762.20.

Resistance:-17502/17542.90/17569.80/17602/17719/17738/17842/18034.

It opened with a huge down gap at 16783.80 and made a low of 16759 and thereafter sharply moved up and made a high of 17309.70 before closing the day at 17255.30. It went near the bottom of 16739 on the line chart intra -day but closed way above it, furthermore it went below all its short term moving averages during the day but managed to close well above it, so at the end of the day it has shown good strength despite yesterday’s reversal pattern, therefore one has to respect price movement in any case and take decision in their trade accordingly to protect gains and cut losses early.

 Now it is having good support from its short term moving averages which is in the range of 17106—16789(it changes every day) for 24-9-15 and from its recent bottom of 17031.15 on the line chart. So it will show potential weakness only if the said bottom and the short term moving average range is taken out. It is looking OK now but not to forget that the long term trend is still down and this bounce could end up as bull trap also. Please note that it will show good strength if it moves above 17571(it changes every day) and sustain. Looking at today’s volatility day trader can try both long and short trade depending on the price movement but please keep in mind yesterday’s trend reversal and be extra alert in long trades.

Trading Strategy 

1.Long call can be tried above 17310 with a stop loss of below 17200 for a target of 17454 and 17502—570. Or near 17106 with a stop loss of below 17031 but avoid fresh long call below 17106 mark for sure.

2. Short call should be tried below 17030 with a stop loss of above 17150, aggressive trader can try short call on the rise around the range of 17530—17570 with a stop loss of above 17660.

Remark:-The trend is down but today’s move  showed some firmness but not to forget that it had trend reversal yesterday and this bounce could end abruptly also  ,therefore both side trade should be handled  with extreme caution and care particularly long trade.

                                                                                  

Please 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.

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.