CNX-BANK NIFTY--A TECHNICAL VIEW--12-10-2015

CNX--BANK NIFTY

Closed at 17590.25 on 9-10-15.

Support:-17502.45/17401.20/17246/17174/17070/16759/16670/16648/16192.

Resistance:-17652.35/17719/17729/17739/17821.90/17842.10/18035/18174.20.

It opened with an up gap at 17640.40 and made a high of 17749.55 and thereafter made a low of 17498.45 before closing the day at 17590.25. It almost touched the short term rising trend line and neckline point of 17750 but could not cross it and retreated back from there, it also broke its most critical support point of 17538.50 intra day but managed to close above it. It hangs in balance now neither showing good strength nor exhibiting complete weakness .Please note that if it fails to show strength in the next week then  reasonable to sharp fall may be in store. For 12-10-2015 its important technical parameters are placed as follows.

(A)    Short term rising trend line at 17835

(B)     Head & Shoulder pattern neckline at 17765.

(C)     Critical support point at 17538(it changes every day)

(D)    Recent bottom on the bar chat at 17401.20

(E)       On the line chart it is making lower top and bottom the recent top and bottom are at 17616.80 and 17474.30.

(F)      Short term moving average range is between 17477-17180(it changes every day).

In view of the above please note that it will gain good strength once it gives up side breakout from the neckline of 17765 and sustain, therefore fresh long trade should only be initiated after it sustains the breakout for at least 2-3 days, similarly it will give first sign of weakness if it closes below its critical point of 17538 and then below 17401 and finally if it breaks and closes below the last point of 17180 and consistently remains below it will confirm the  rally may be over for good. Although it hangs in balance now but overall technical tilt is slightly towards downside.

TRADING STRATEGY FOR-12-10-15

1.It  would be safe to try long call only  if it sustain above 17765 with a stop loss of below 17640.

2. Aggressive day trader can try long call above 17538 with a stop loss of below 17450.It could be a risky trade.

3. Aggressive trader can try short call near 17765 but not above this with a stop loss of above 17840.It could be risky trade but worth trying.

4. Short call can be tried if it maintains below 17538 with a stop loss of above 17660.It could be a risky trade.

Remark:-The long term trend is still down .It is exhibiting weakness in totality therefore long trade is ruled out till it shows some  strength or move above 17765 and sustain, instead short call can be tried as suggested above.

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.