CNX--BANK NIFTY-A TECHNICAL VIEW 12-1-2017

CNX--BANK NIFTY

Closed at 18830 on 11-1-2017(Open-18535.35/High-18889.45/Low-18515.25)

Support:-18824.40/17739.65/18713.60/18551/18537/18532/18443.65/ 18325.50/18316.25/18242.10/18177.20/18143.70/17952.60.

Resistance:- 18961.15/19059/19096.70/19125/19158/19493.50.

It opened with an up gap and exhibited exhilarating strength and moved up by around 450 points intra-day and ended the day with a whooping gain of 420.40 points. It crossed its recent important top of 18739.65 and also moved above its last long term moving average intra-day, which is placed at 18855(it changes every day) for 12.1.2017 but could not close above it. Please note that sustained close above its last long term moving average i.e. 18855 for 12-1-2017 will further accelerate the up momentum.  Although it is showing good strength but it has also moved up vertically by more than 1000 points in last 5 days so the vulnerability for short down correction also increases, therefore one should be very careful in long trade at this juncture.  There is no doubt that it is buy on dip market now therefore every reasonable decline should be used for buying but not below 18441 as of now.

It is very important to mention here that  it made no effort to fill the today’s gap ,so if it comes down to fill the gap in next 2-3 trading session which is technically possible ,in that case it could come down to 18441 level, so be watchful and do not hurry to initiate long trade on the opening bell, furthermore if it opens with an up gap i.e. above 18890   on 12-1-2017 then for sure do not jump on to initiate long trade immediately instead watch the market for some time and let it settles down then take your trading call. Please note that if it consistently starts trading below 18830 then it could correct, so long call below 18830 should be avoided and tried after reasonable decline.  

I once again reiterate that as long as it is above its benchmark points of 18242.30 & 18177.20 for the year 2017 there is no serious threat to the uptrend, however it could witness in between down correction moving up.

 TRADING STRATEGY

1. Long call can be tried if it moves and sustain above 18855 for some time with a stop loss of below 18800. The upside target could be 18963/19060/19125/19158/19494.

2. Aggressive trader can try long call on decline at appropriate points but not below 18444 with a stop loss of below 18370.

Remark: - As of now it is a buy on dip market, but since it had a huge vertical rise therefore it looks vulnerable for a down correction for a day or two any time, however long call can be tried as suggested above but it is advised to handle your trade with caution.

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.

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.

                                                                                     

Contact me for strategic guidance to enter and exit the trade.