CNX-BANK NIFTY--A TECHNICAL VIEW--5-10-2015

CNX--BANK NIFTY

Closed at 17150.20 on 1-10-15.

Support:-17070/16946/16759/16670/16648/16484/16192/15762.20.

Resistance:-17174/17216.30/17246/17465/17502.45/17542.90/17569.80/17602.

It opened on a positive note at 17362.95 and made a high of 17390.60 thereafter gradually moved down and made a low of 17111.65 before closing the day at 17150.20. It had a down day today and it showed first crack in the on-going up move by closing below its short term rising trend line which was at 17220,it would be at 17335for 5-10-15, it has fallen within its short term moving average range of  17215—16835(it changes every day) so moving up it will face resistance at 17215, it has not  yet violated its recent bottom of 17100.30 on the line chart, this is the only hope now for the current up move to continue,  but in last three days it had made  lower top of 17461.35/17449.85 & 17390.60 intra-day on the bar chart which indicates weakness. So for showing strength first it has to cross  the upper band of the moving average range of 17215 then short term rising trend line at 17335 then the recent higher top of 17461.5 and finally to cross 17550 mark(it changes every day) and sustain above it for at least 3-4 days. Looking at the weakness it exhibited in last couple of days it seems dam difficult to cross these hurdles and continue the up move. It has already given crack in the on-going up move by breaking the rising trend line and close below 17100 will confirm the weakness but since it has bed of support at 16835/16759/16670&16648 so it will show potential weakness if these levels are taken out ,chances of which looks pretty much possible in coming days. It is needles to mention here that since the trend is down and today’s move was also weak, so for safe traders  it is suggested to avoid long call below 17462 but if initiated before should be handled with caution and care.

TRADING  STRATEGY

1. It is suggested to avoid long call below 17462 but aggressive trader can try it above 17220 or 17290 with a stop loss of below 17100 & 17200 respectively.

2. Short call can be tried if it sustains below 17216 or below 17100 with a stop loss of above 17311 & 17230 and below 17031 for sure with a stop loss of above 17140, aggressive trader can try short call on the rise around 17462-17550 but not above 17550 mark with a stop loss of above 17660.

Remark:-The long term trend is still down. It has been under- performing for last few days and broken the trend line today which indicates weakness, therefore it is suggested to avoid long call now. Since the bias is down, therefore I would personally look for an opportunity to sell only till it moves above 17550 and sustain, but one can try both side trade calls 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.