CNX-NIFTY-A TECHNICAL VIEW FOR—18-4-2016

CNX-NIFTY

Closed at 7850.45 on 13-4-2016 (Open-7777.15/High-7864.80/Low-7772.20)

Support: - 7772/7723.85/7714/7691.20/7691/7678/7667/7600/7582.25/7551/7540/7539.50/7516.85/7422/7405/7350.30/7295/7252.

Resistance: - 7873/7938.45/7946.35/7961.35/7972.55/7979.30/8055/8065/8091.80/8116/8160/8180.20/8195.65/8244/8336.

As expected it gave big move today on the upside (see my post for 13-4-2016), it opened with a huge up gap and did not make any effort during the day to fill the gap at all and steadily moved up and closed near the high of the day with a gain of 141.50 points. It is exhibiting tremendous strength but the unfilled gap is concerning because as per theory there is a good possibility for at least next 3-4 trading session that it could make an attempt to fill the gap and if it does then it could come down to 7717 level. Even otherwise, although it is showing good strength but since it had a vertical rise of more than 340 points intraday and 295 points on closing basis in last three days therefore normal correction could also creep in anytime, so be watchful and alert. The bias is on the upside now and the technical parameters indicates that it could give a decent up move from here as long as it holds 7627 and finally 7539.50 levels but it could witness in between  corrective down move  , so long call can be tried at the appropriate levels if it corrects. It is important to mention here that as it still looks good for continuing the up move but as per theory the vertical rise may have a vertical fall also therefore long trade should be handled vigilantly and with extreme caution and care.  

Please note that moving up it will face huge resistance in the range of 7923—7980, furthermore 7938.45 & 7946.35 are one of the most critical points for it for the year 2016. If it moves and sustain above 7946.35 and then crosses 7980 and sustain then the on-going up move may extend further and will face next set of resistance in the range of 8055--8196. In view of the tough resistance range ahead it seems that the up journey from here may not be smooth but the trend is up, so long call can be tried on dip but not below 7700. The range of 7935—7980 looks highly vulnerable for correction therefore fresh long call should be avoided around this range instead existing long trade should be exited completely and one should stay quite around this range as far as fresh long trades are concerned. Please note that fresh long call should only be attempted once it closes above 7946.35 and sustain, if it sustains above this level then it may hit 8200+ levels in coming days/weeks.

For 18-4-2016 long call can be tried if it maintains above 7865 with a stop loss of below 7770 and book profit in the range of 7930—7945—7980. If it opens with an up gap at 7900+ then avoid fresh long call and book profit in existing long trade on the rise in the range mentioned above.  It would be worth trying 8000 or 7900 put option around 7945--7980 range with a stop loss of above 8025. 

Remark: -It view of the above observation all long trade should be exited in the range of 7935—7980 and wait for the close above 7946.35 for trying fresh long call next day.

 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.