CNX-NIFTY--A TECHNICAL VIEW--5-1-2016

CNX-NIFTY

Closed at 7791.30 on 4-1-2016(Open-7924.55/High-7937.55/Low-7781.10)

Support:-7723.85/7714.15/7691.20/7678/7667/7575.30/7539.50/7422/7311/7295/7119

Resistance:-7840/7863/7938.45/7940/7946.35/7960/7979.30/7997/8055/ 8065/8091.20/8116.10/8244.

It did not went beyond 7979.30 therefore as expected it went down sharply today breaking bottoms on the line chart, breaking short double bottom of 7889 on the bar chart and breaking almost all its short term moving averages which is a bad sign. Its high for the day  was below the alert point of 7938.45, so the fresh buying was out of question today (see my post for 4-1-16). You are well aware that I have been alerting time and again (see my earlier post) that this up move was a pullback rally and could end anytime, so it was a complete breakdown today and possibly the end of the on-going up move and beginning of fresh down move. So now sell on the rise strategy is suggested till it moves and sustain above 7946.35. However in between short up day could be there.

Moving down it could find support from the retracements points at 7761.80/7712/7650/ and also from its earlier bottoms at 7725/7723/7714/7691/7667/7551/7539. Please note that if it breaks 7650 marks and sustain then the fall may accelerate and may test or break the recent major bottom of 7551 & 7539.

Please note that its alert or benchmark point for long trade for the entire year of 2016 is 7946.35 & 7938.45 and it has decisively broken these points today. Therefore long call is completely ruled out till is moves and sustain above 7946.35.

For 5-1-2016 it is suggested to sell on the rise but below 7938 with a stop loss of above 7990 or sell below 7781 with a stop loss of above 7830.   

Remark:-The long term trend is down. The on-going up rally seems to have ended with the complete breakdown in the market today. So now sell on the rise strategy is suggested till it moves and sustain above 7946.35. Buying is ruled out as of now.

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.