CNX--BANK NIFTY- A Technical Update for 18-1-2016

CNX--BANK NIFTY

Closed at 15206.30 on 15-1-2016(Open-15621.85/High-15650.70/Low-15154.35)

Support:- 15130.35/14858.90/14709.10/14338.65/13414.30.

Resistance:- 15762.20/16188.05/16192/16587.25/16648.30/16670.55/16741/16824.05/16922.05/16932.50/17067.45/ 17174.70/17246.55/17499/17502.45/17569/17652.35/17827/18029.05.

It opened on a positive note but could not hold on and steadily moved down, it closed near the low of the week and with a loss of 403.50 points and most importantly way below its one of the most important level of 15762.20 valid for the entire year of 2016 for the 2^nd consecutive day which is a bad sign and indicates gross weakness in it. Technically it is already on a very weak footing and today’s move suggest that the on –going fall may continue for few days before it takes a breather and moving down it will find support at 15130/14858/14709  . The range for the week starting from 18-1-2016 is between 15130—15762.20.and sustained breakout on either side will decide the direction of the market for the week. It is needless to mention here that it is in the long term bear market.

It is important to mention here that long call should be avoided for the entire year of 2016 if it remains below 15762.20 and below 15130 for the entire week starting from 18-1-2016. Please note that it is already in a bear market because it is well below its threshold level of 16725 for the bear market which is hugely negative sign, therefore long call can be tried at lower levels only if visible sign of some kind of bottom formation emerges or else as stated above.

For 18-1-2016 it is suggested to try short call below 15130 with a stop loss of above 15210 or sell on the rise but not above 15762.20 with a stop loss of above 15800. Looking at the overall technical setup long trade is not recommended till it shows some strength at the lower levels or until and unless it moves and sustain above 15762.20 levels. It is advised to watch the market for some time before initiating trade.

  Remark:-The long term trend is down. Since it is already in a long term bear market territory long call  should be avoided  till is shows strength or until and unless  it moves and sustain above 15762.20 , 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.