CNX--BANK NIFTY- A TECHNICAL VIEW – 22-4-2016

CNX--BANK NIFTY

Closed at 16637.15 on 21-4-2016(Open-16526.55/High-16769.55/Low-16526.55)

Support:16587.25/16349.70/16282.75/16205/16188/16141.65/16099.65/16080.55/15958/15762.20/15682.65/15522/15440.25/15178.30/14989.40/14761/14754/14445/13810.6013407.25.

Resistance:- 16648.30/16727/16750/16824.05/16922.05/16932.50/17067.45/17174.70/17246.55/17498.35/17502.45/17719/18029.05.

It opened with a huge up gap and moved up further and crossed its bear market threshold point of 16726 intra-day but slipped down and closed below it. It gave a robust up move of more than 400 points intra- day and 287.45 on the closing basis, it is exhibiting good strength on the technical chart and is buy on dip market as of now, but the concerning thing is that the gap it created today is still intact and if it makes an attempt to fill this gap in next 3-4 days which is possible as per theory then it can come down to 16386 level, so be careful in long trade. Since it tested its bear market threshold point of 16726 and it down trend line resistance point  at 16735 (it changes every day) intra-day and made today’s high of 16769.55 then slipped down and closed way below these points. Therefore it would be safe to try fresh long call above 16770, in this regard also note that the range of 16726—16940 is very tough range to cross and it will gather real up momentum only if it gives sustained close above 16940, so handle your trade very carefully till it closes above it.

It is important to mention here that tomorrow will be the 34^th day of entire up move from the bottom of 13407.25 made on 29.2.2016 and it is a Fibonacci number, so this up move may top out also on 22-4-2016. So tomorrow will be a crucial day therefore it would be safe to avoid long call. Going down from here it will find support at 16526.55/16386/16282.75/16188/16011.   

For 22-4-2016 watch the market for sometime before initiating trade. For safe trader avoid long call  instead try short call near 17770 but not above it with a stop loss of above 16830. Or sell below 16526 with a stop loss of above 16650 for a target of 16386/16282.75/16188.  

Remark: - It is already in the long term bear trend since 4-1-2016. In view of the above observation avoid long call for sure instead try short call as suggested above but with caution.

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.