CNX--BANK NIFTY
Open-20394.75--High-20866.55--Low-19729.30—Close-20742.80 on
17-4-2020
Support:-20608/20598.55/20324.10/20010/19729.30/19520/19144/19122.10/18703.45/18345/18162.53/17719/17606/17502/17350/17248.42/17143.20/16946/16759/16587/16193/16116.25.
Resistance:-20866.55/21042.35/21462.40/21947/22418/22469/22996.40/23611.10/23657/24240.
(Bold and
underlined figures are most important)
It exhibited huge volatility during the preceding week but it
finally crossed its crucial point of 20010(see my last post of 13.4.2020) decisively
at the end of the week, which is a good sign. On the daily chart it is making
higher bottom and higher top in Line & Bar chart and well above its short
term moving averages too, which indicate strength and possibly this rally may
last few more days as long as it holds 20010 mark on the closing basis. But be
aware that such bear market rallies create confidence of the highest level
among the traders and investors and sucked them in to the market and trap them
miserably. It seems that the confidence in the market is at a high now despite
the Covid-19 pandemic, which will have a colossal impact not only on Indian
economy but for the entire world economy financially and otherwise too,
therefore it is suggested to be vigilant & cautious in the long trade at
this juncture. Furthermore it is showing less strength in comparison with CNX-
Nifty, therefore this rally may fizzle out anytime.
It is important to note that since it has closed above its crucial
point of 20010 it has opened the upside up to 22418 as long as it holds it, but
moving up it would face tough resistance at 20866.55/21462.40/ and most
importantly in the range of 21805—950 from its major rising trend line on the
monthly chart. It is less likely to sustain above this range as of now but if
it does and moves above 22418 and sustain then it will open up the upside up to
24365. In view of the above observation either this rally has exhausted when it
hit a high of 20866.55 on 17.4.2020, else the possible exhaustion point of the
rally would be in the range of 21850---21950—22500 or else it will
exhaust if it closes below 19050 as of now.It will signal break down if it
sustain below 18700 on the closing basis.
TRADING STARTAGY
1. Buy on decline but not below 20010 with a stop loss of below
19800.
Or
Buy above 20866.55 with a
stop loss of below 20500. This would
be relatively safe
option.
2. Sell if it does not
cross 20866.55 in at least one and half hour trade,
with a stop loss of above 21100.
Or
Sell in the range of 21850—950---22450 with
a stop loss of above
22600.
NOTE: - Please see support & resistance points mentioned
above for entry point and possible targets for the trade.
IMPORTANT NOTE: - Be alert in short trade if it closes above 20866.55
& 21950 and be alert in long trade if it closes below 20010.
Remark: - It is in the bear market but it gave good
pullback rally and ended the week near the high. The daily chart is still
showing some strength, so this rally may last a few days more. So long trade
can be tried as suggested above but with due care and caution because it’s
relative strength in comparison with CNX-Nifty is weak, therefore one cannot
rely on this rally with firm belief. Similarly one should definitely take a
short trade within or near the exhaustion range or as suggested above. The
trend is down and long term bias 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.
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 are of spot market.
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