CNX-NIFTY
Open-10514.10—High-10540.65---Low—10267.65---Close—10316.45
on 5-10-2018
Support:10313.56/10276/10180--170/10141.85/10094--10033/9951.90/9792/9740/9687.55/9685.55/9448/9408/9341/9119.20.
Resistance:10417.80/10478.60/10530.70—10558/10631---637/10784.
It
made a top of 11760.20 on 28-8-2018 and thereafter it started correcting and
plunged sharply in last three days breaking major support levels and all short,
medium and long term moving averages decisively, which is a bad sign. It is
important to mention here that it took 24 weeks from the recent major bottom of
9951.90 to top out at 11760.20, but it fell down sharply and only 365 points
away from the bottom in just 5 weeks, therefore it seems that it is an
impulsive down move and if it is so then this could be painful price wise and time
wise both and likely to hit 9951 level during the next week and may move down
further also in coming weeks/months. Furthermore the intensity of the fall for
the last few days and the negative divergence appearing in RSI on weekly and
monthly chart indicate that the on-going correction may deepen further and it could
break 10000—9951 levels and drift further lower but there may be relief rallies
in between. The uptrend is in extreme danger and it may slip into bear market
if it does not claw back quickly above its critical range of 10530—553 and then
move above its long term moving average range which is placed between
10993---10731(it changes every day) and sustain. Therefore to keep the uptrend
intact it has to sustain above the aforesaid range which may please be noted.
It
has been opening with a down gap for last two days and the gaps remained
unfilled, if on 8-10-18 it again opens with a gap down i.e. below 10267.65 and
goes down further then it is suggested to cover the short position in stages if
not completely at least partially in the range of 10180—10170 and then 10094—10033--9951
because generally after the 3rd gap whether up or down it moves vice
versa. The trend is down and it is a sell on the rise market but it may give a
smart or reasonable pullback after the 3rd down gap to give trader a
chance to sell at a higher level. The potential sell point on the expected pullback
could be 10418/478/530. Moving down it may find good support at 10276/10180—170/10094—033/9951.90/9827/9687—85/9448/9408/9370/9119.20/8806/8667,it
may make a short bottom at any of these points. But it may make a potential bottom
in the range of 9800—9408 but if it breaks 9408 and then 9119.20 and sustain
then it could go down to 8930---8800---8640--8600 levels which may please be
kept in mind. In worst case scenario the aforesaid range of 8930---8800---8640—8600
is the potential range for bottoming out. Moving
down 9408 & 9119.20 would be the critical point.
Remark: - The long term uptrend is potentially
threatened and if it does not stage a smart recovery quickly and move above its
critical points and long term moving averages and sustain then it may slip into
bear market. Therefore it is suggested to avoid long trade till fall is
arrested and it gives visible sign of correction completion. So as of now sell
on the rise strategy should be adopted. However aggressive trader can try long
trade if they wish to near the important support points for a pullback rally
but with extreme caution because pullback rallies are treacherous in nature.
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 favourable 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.
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Thank you for sharing your views.