CNX-NIFTY- A TECHNICAL VIEW -16-1-2017

CNX-NIFTY

Open-8457.65—High-8461.05---Low—8373.15—Close—8400.35 on

13-1-2017

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

Resistance:- 8422.50/8433/8476.70/8506/8518/8558/8598.45/8678.75.

It opened with a good up gap but could not sustain at the higher level and closed with a minor loss of 6.85 points. It crossed its last long term moving average intraday which is placed at 8422.50(it changes every day) for 16-1-2017 but could not close above it. Although it closed on a slight negative note today but the overall technical setup is showing good strength and it is moving in a rhythm, as it is still making higher top & bottom on the line chart and higher highs and higher lows on the bar chart, therefore the on-going up move seems to continue as long as it holds 8236 on the closing basis and finally the critical benchmark points of 8210.10 & 8185.80 for the year 2017. So it is definitely  a buy on dip market as of now,  however moving up it may witness short down correction from time to time which would be healthy for a sustained up move. I once again reiterate that sustained close above its last long term moving average i.e. 8422.50(see my earlier post) will further accelerate the up momentum.

 It is also very important to mention here that moving up the range of 8419—8485 and then from 8517—8600 will pose a very stiff resistance, therefore further up journey from here may not be smooth, so be vigilant and watchful in you trade around these range. Please note that on 16-1-2017if it consistently starts trading below 8400 and break 8373 level then it could correct sharply before resuming the up move again. Therefore fresh long call be avoided below 8400 for sure and tried after a reasonable decline or try long call only if it moves and sustain above 8422.50 with a stop loss of below 8395.  

TRADING STRATEGY

1. Long call can be tried if it sustains above 8422.50 for some time with a stop loss of below 8395. The upside target could be 8442/8461/8477/8506—8538/8558/8598.45.  

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 consistently trades below 8395 with a stop loss of above 8425 for a target of 8373/8350/8330/8306/8275. It could be a risky trade.

Remark: - As of now it is a buy on dip market. It is showing good strength but long call should only be tried if it moves and sustain above 8422.50 for some time or else wait for reasonable decline to enter the market.

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.