CNX-NIFTY- A TECHNICAL VIEW -13-1-2017

CNX-NIFTY

Open-8391.05—High-8417.20---Low—8382.30—Close—8407.20 on

12-1-2017

Support:-8400.25/8380/8350/ 8330/8306.85/8294.95/8274.95/8259.35/8243.80/8230.65/8210.10/8185.

Resistance:- 8421.20/8433/8476.70/8506/8518/8558/8598.45.

It opened with a minor up gap but filled the gap during the day but yesterday’s gap is still there which is slightly concerning because it could still make an attempt to fill the gap in next 1-2 days time and if it does then it can come down to 8294 level. It moved in a short range today and went near its long last term moving average which is placed at 8421.20(it changes every day) for 13-1-2017 but could not cross it, however looking at its present strength it seems that eventually it may cross this mark and if it does and sustains above it then the up momentum will further accelerate, therefore till it moves above 8421.20 mark one should be extremely careful in long trade. Furthermore it moved in a short range today which indicates that it may be bracing for a big move on either side in a day or two probably corrective down move if it does not move above 8421.20 and sustain. It is therefore suggested to try fresh long call only if it moves and sustain above 8421.20 or else after a reasonable decline but not below 8294.

TRADING STRATEGY

1. Long call can be tried if it moves and  sustains above 8421.20 for some time with a stop loss of below 8380. The upside target could be 8433/8458/8477/8506--8538.  

2. Aggressive trader can try long call on decline at appropriate points  but not below 8294 with a stop loss of below 8230, it could be a risky trade but with even chances.

3. Contrarian short call can be tried, if it fails to cross 8421.20 for some time, then sell near 8421 with a stop loss of above 8440 for a target of 8400/8382/8350 or sell below 8382 with a stop loss of above 8425 for a target of 8350/8330/8306. It could be a risky trade but worth trying.

Remark: - As of now it is a buy on dip market. It is showing good strength but in view of today’s short range move and not crossing its long term moving average, long call should only be tried if it moves and sustain above 8421.20 for some time or else wait for reasonable decline to enter the market. Short call can be tried as suggested above if price pattern permits.

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.

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.

Note: Price stated here is of spot market.

Contact me for strategic guidance to enter and exit  trade.