CNX-NIFTY- A TECHNICAL VIEW-26-11-2016

CNX-NIFTY

Support:-8077/8063/8002/7992/7952.55/7946/7935/7927/7897/7859/7807/7735-7714.

Resistance:-8122.25/8151/

8176—8193//8258/8287/8295/8338/8476.70/8489/8506/8518/8540-8555/8598.45.

As expected the level of 8052 was broken(see my post of 6-11-2016) and it went on to break the bottom of 7927.05 it made on 24.6.2016 and hit a low of 7916.40 but did not close below the bottom of 7927.05. It moved in a short range thereafter for three days and yesterday it gave a robust up move.

It is important to mention here that 7927.05 was one of the major bottom and 7897.28 was the 50% retracement point of the entire recent rise from the  bottom of 6825.80 to the top of 8968.70,furthermore the critical points for the year 2016 are also at 7946.35 & 7938.45,so the range of 7946.35 to 7897.28 was a very strong support range and it respected this range moving down and staged a bounce back from there which was quite normal and expected because technically it rarely breaks the huge support range at one go, but looking at the overall technical setup it seems that the recent low of 7916.40 may be taken out in coming days /weeks and  if it breaks and sustain below 7850 then it may hit much lower levels of 7714—7644---7500  also, which  is very likely as of now.   

The trend is down and the on-going up move seems to be a pullback rally only which may fizzle out at any of these points.8177/8258/8338/8438/8463 or since it is still below it long term moving average range of 8446-8403-8348-8303-8193-8151-8104.65(it changes every day) except for one which is at 8104.65(it changes every day) moving up the rally can end at any of the aforesaid points also or if it fails to hold 8104.65(it changes every day)level. The trend is down therefore long call is not suggested however those who wish to take advantage of this pull back rally can try long call above 8104.65 with a stop loss of below 8040, aggressive trader can try short call on the reasonable rise and at appropriate points (can take help from the above mentioned figures) with a proper stop loss or sell if it sustains below 8100 with a stop loss of above 8155. But those who want to play safe should try sell call below 8100 only.

It is very important to note that it will regain the desired up momentum only if it moves and sustain above 8463. The journey from the present level to the said mark is looking very tough at the present moment. Please be very careful and cautious in long trade and I once again reiterate to avoid long call below 8100.

Remark: - The uptrend is severely threatened and it is in intermediate downtrend now. The on-going up move is a pullback rally and once it is over then it is expected to resume the down move again and the recent low of 7916.40 may be taken out. So those who wish to try long call can try above 8105 but be cautious because this rally may end abruptly also. Short call can safely be tried below 8100 or as suggested above. The overall technical setup is bearish.

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.

CNX-NIFTY--A REVIEW (IT IS IN CORRECTION MODE NOW AND CRITICALLY POISED )-6-11-2016

CNX-NIFTY

Support:-8400/8398/8353/8336/8287/8063/7992/7946/7935/7927.

Resistance:-8476.70/8489/8506/8518/8540-8555/8625.70/8653.15/8661/8669.60/8678.25/8728.35/8736.95/8745.

I feel that the observation in my last post of 24-8-2016 was relevant and valid till date as it moved within the mentioned range for so long. The range was 8476—8517---8661—8730—8930(see my post of 24-8-2016). It did close above 8930 for a day on 6-9-2016 and next day hit a intra-day high of 8968.70 but could not sustain above 8930 on the closing basis and thereafter started making lower top and bottom but defended the critical and breakdown point of 8476.70(see my post of 24-8-2016). But it has broken this critical point on 4-11-2016 which is a bad sign because sustained close below this mark can drag it down sharply. Going down it may find support at 8324/8172/8135/8052, it may stage a bounce back from any of these points but sustained close below 8052 could dent the long term uptrend. Similarly moving up it would face resistance at 8463/8507—8555/8625.70---8679/8728---8745.

Please note that as of now the long term uptrend is still intact as it is above all its long term moving averages but it is pretty to close to the upper band of the averages now so it dangerously poised. The range of long term moving averages is between 8431.50—8052(it changes every day) for 7-11-2016. Please note that break and sustained close below   8431 will be a threat to the on-going uptrend and sustained break and close below 8052 may end the uptrend. The few technical indicators are also pointing that a reasonable to severe fall could be imminent and the level of 8052 may be taken out in coming weeks/months. Furthermore I once again reiterate (see my post of 5^th and 24^th August-2016) that it is moving in 8 years time cycle and it witnessed crash in the year 1992, 2000 &2008 and 2016 is the eighth year again and all the ingredients are present for a severe down correction or a crash like situation now, such as huge upsurge in value of small and mid caps stocks irrespective of the fundamentals and flurry of IPO’S in last few months.  The down correction is already on and in last two trading session small and mid cap stocks have taken severe beating then the large cap stocks the up momentum is shaken by this beating and if it continues for another day or two then it will be difficult to regain the up momentum again very soon therefore it has to be seen how this on-going correction culminates. The things are not looking that great technically. So be careful in long commitments as of now.  

It is important to mention here that U.S.A election is ahead next week and the outcome of it could impact the stock market world over in either way for a while and huge volatility could be witnessed. but eventually fundamentals of your own  would come into play and guide your market. So be vigilant and cautious in the market for at least the coming week.   

Remark: - It is still in long term uptrend.  But it is in correction mode now and it is precariously poised because long term uptrend could be threatened if it breaks 8431.50 and sustain below it, therefore it is suggested to avoid long call below 8430 furthermore market could witness huge volatility in wake of U.S election outcome in coming week, it is therefore suggested to keep your trade commitment light.The overall technical setup looks bearish. 

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.