CNX-NIFTY--A TECHNICAL VIEW--4-12-2015

CNX-NIFTY

Closed at 7864.15 on 3-12-15.(Open-7902.30/High-7912.3/Low-7853.35)

Support:- 7840/7723/7714/7691.20/7678/7667/7539.50/7422.15/7295/7118.

Resistance:-7936

/7940/7960/7997/8055/8065/8088.60/8091.20/8116.10/8195.65/8269/8272.80/8282.70.

It seems that the rally which started from the bottom of 7714.15 it made on 16-11-2015 is possibly over, however if it has the strength then it can make an attempt to bounce from 7846/7812/7776 levels, chances of which are looking slim at this point of time, furthermore even if it bounces back from the aforesaid levels moving up it will face huge resistance in the range of 7874—7915(it changes every day) and then 7936---7980 and crossing this range and sustain does not seem easy. Therefore in view of above and certain technical parameters, it is suggested to avoid long call below 7980 for the entire month of December-2015 instead try short call on the rise but not above 7960 with a stop loss of above 8000.

It is important to mention here that it is already below its neckline of the Head and Shoulder pattern on the weekly chart which is in the range of 8040—8066 and its possible downside target could be in the range of 6880--7090(see my earlier post) therefore the threat of moving down is already there till it moves above this range and sustain, chances of which are looking extremely weak. Furthermore a possible Head & Shoulder pattern is in the making on the daily chart also and its neckline would be in the range of 7700—7710 and possible downside target could be around 7000—7100,so break below 7700 will doubly make sure that in all likelihood it could hit 6880-7100 mark in near future. So be alert and watchful.

Remark:-The long term trend is down. It seems that the on-going pull back rally is over therefore it is suggested to avoid long now instead try short call on the rise 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.