CNX-NIFTY--A TECHNICAL VIEW--15-2-2016

CNX-NIFTY

Closed at 6980.95 on 12-2-2016(Open-7023.65/High-7034.80/Low-6869)

Support:-6868.85/6638.55/6432.70/6357.10/6338.50/6300/6275/6129.

Resistance:-7118.45/  7241.50/7295/7350.30/7422/7512.55/7539.50/ 7551.05/7563.55/7589.50/7600.45/7667/7678/7691.20/7714.15/7723.85/7840/7863/7938.45/7940/7946.35/7960/7979.30/7997/8055/ 8065/8091.20/8116.10/8244.

It opened with a short up gap today but could not hold on at the upper level and immediately drifted downward and broke yesterday’s low of 6959.95 and also went below 6900 level intra-day but closed the day with a meager gain of 4.60 points and that too after 4 days of continuous fall of more than 640 points intra -day and 410.90 on the closing  basis.

Please note that after yesterdays panic, today it did not behave the way it should have for making a possible short bottom (see my post for 12-2-2016). Therefore it seems that an expected short bottom is still not in place and today’s low of 6869 is likely to be taken out in coming days/weeks. However it will act as a valid support point for the entire week starting from 15-2-2016, therefore one should be alert in short call above this mark. Furthermore it has very strong support range between6825—6713 and then 6685—6580, so it may make short bottom around these range. But please note that sustained break below 6580 can drag it down to much lower levels. 

It is extremely weak on the chart but it took a short breather today and this move may extend for few days provided it closes above 7021 and sustain else it can fizzle out anytime and may resume the down move again, moving up it would face resistance at 7118.45/7191/7241-7267/7295 & 7360 and possibly the expected up move can exhaust at any of these points so be watchful and alert. But since the trend is down, so it is suggested and would be safe to avoid long call for taking advantage of in between up move and it should be avoided for sure below 6869 for the entire coming week and sell on the rise strategy should be followed now. Please note that long call can only be tried if it shows some visible strength but it would be safe to try long call if it moves above the bear market territory threshold point of 7295 and sustain.

For 15-2-2016 can sell below 6970 with a stop loss of above 7021 for a target of 6869 and sell below 6869 for sure with a stop loss of above 6900 for a target of 6825/6787/6758-6722-6700. Since it gave up close today after a huge fall so this up move may continue for a day or two therefore the aggressive and contrarian trader can try long call also if it moves and sustain above 7021 with a stop loss of below 6970 for a target of 7095—7110, but be vigilant and extra careful in long trade.    

 Remark:-It is in long term bear trend now.  It seems that a short bottom is still not in place therefore it is better to avoid long call till it shows some strength but  in view of the present setup both long and short call can be tried depending on the price movement and 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.