CNX--BANK NIFTY- A TECHNICAL VIEW – 4-5-2016

CNX--BANK NIFTY

Closed at 16388.70 on 3-5-2016(Open-16570.75/High-16719.40/Low-16358.40)

Support: 16386/16349.70/16282.75/16205/16188/16141.65/16099.65/16080.55/16011/15958/15762.20/15682.65/15522/15440.25/15178.30/14989.40/14761/14754/14445/13810.6013407.25.

Resistance: 16526/16587.25/16648.30/16726/16750/16824.05/16922.05/16932.50 - 17067.45/17174.70/17246.55/17498.35/17502.45/17719/18029.05.

It had a hugely volatile move today but at the end of the day, it showed extreme weakness. I once again repeat that it has fallen inside its down trend line, making lower top & bottom and running below its all short term moving averages and breaking its long term moving average layer every day (see my post for 3-4-2016) and the last such average is being at 15960(it changes every day). Therefore in all probability it is likely to go down further from here, however in between short up move cannot be ruled out. It is therefore definitely a sell on the rise market now till it closes above 16795 as of now. Moving down it will find support from its long term moving averages at 16385/16240/16100/15960 (it changes every day) and from its Fibonacci retracement point’s at 16234/16046/15815. It may stage a relief rally from any of these points, so be vigilant.  Long trade should be avoided till it gives visible indication of correction completion. Please note that It has a strong bed of support in the range of 16245—16220, so it may take a breather here before falling further, so be watchful. The bias is down for sure as of now.

Please note that the range for the on-going week is between 17030—16526. Since it is has broken the range downside therefore long trade is ruled out and short call can be safely tried below 16526. The short range for the day is 16526----16220, so structure your trade keeping this range in mind.

TRADING OPTION FOR-4-5-2016

1. Sell on the rise but not above 16795 with a stop loss of above 16840. The possible sell point could be at 16526/16614/16685/16795.   

2. Sell below 16358 with a stop loss of above 16410 for a target of 16349/16282/16205. It could be a risky trade.

Remark: - It is surely a sell on the rise market now; therefore long call should be avoided. Instead short call can be tried as suggested above. Please initiate your trade after watching the market for at least 30-45 minutes.   

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.