CNX-NIFTY
Closed at 7610.45 on 11-12-15.(Open-7699.45/High-7703.05/Low-7575.30)
Support:-7775.30/7539.50/7422.15/7295/7118/6869.
Resistance:-7667/7678/7691.20/7714.15/7723.85/7840/
/7940/7960/7997/8055/8065
It had a devastating week; it plunged down by
250 point intra-day during the week and finally ended the week with a loss of
more than 170 points. It decisively broke the neckline of the Head &
Shoulder pattern on the daily bar chart which is now at 7735(it changes and
will be moving up). Furthermore it is also running way below its neckline of
the Head & Shoulder pattern on the weekly bar chart which is now at 8100
(it changes and will be moving up) therefore chances of achieving downside
target of the H&S pattern in coming weeks/months seems very bright which is
in the range of 7100---6880(maximum)(see my post for 4-12-15). Please note that
the pattern can only be negated if it moves above both the necklines and
sustain, chances of which are looking extremely weak at this point of time.
Please note that it has cluster of support in
the range of 7539.50--7520,it came closer to it today but managed to hold it
now but not likely to hold in near future and expected to drift much lower in
coming days/weeks (see support level mentioned above),however in between short
up move could be there. It is important to mention here that the threshold level for
it entering the bear market is at 7295, so going down it could find support at
this point, if it moves below this mark and sustain down speed may accelerate . The bias is hugely down and it is clearly sell on the
rise market as of now, so it is suggested to avoid long call till it gives
visible sign of some kind of bottom formation but those who want to can try as
long as it is above 7575.30 or near 7539—7520 range with a stop loss of below
7560 and 7500 respectively. Short call can be tried below 7575.30 with a stop
loss of above 7620.
It is suggested to avoid long call for the entire month of
December -2015 till it moves above 7775.70 and then 7817,avoid long call if it
moves below 7575.30 for the entire week
starting from 14-12-15 till it bounces back above it. Therefore the broad range
for the Nifty now is 7817—7575.30--7520, so take your trading call keeping this
range in mind but not to forget that the trend is down; so long call if
initiated should be handled with extreme caution and care.
Remark:-The long term
trend is down. In view of the above observation it seems that further fall is
very likely, therefore it is better to avoid long call till it shows some
strength instead short call can be tried on the rise at appropriate levels with
proper stop loss or as mentioned 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.
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Thank you for sharing your views.