A BROAD TECHNICAL VIEW ON CNX-NIFTY FOR THE WEEK STARTING FROM---27.4.2020

CNX-NIFTY

Open-9163--High-9296.90—Low-9141.30—Close-9154.40 on 24.4.2020

Support:9133/9090/9038.90/8981.45/8966/8860/8842.28/8821.90/8801.14/8774.67/8712.85/8672.07/8553/8537/8461/8327.20/8269/8148.50/8055/7946.74/7893.80.

Resistance:9269.20/9343/9390.31/9460/9580/9685.55/9687.55/9944.40/9951.90/9958.55/9970.80/10004.55/10020.35.

 (Bold and underlined figures are most important)                                                                       

In the preceding week it exhibited huge volatility and as envisaged it hit the benchmark and possible bear rally exhaustion point of 9390.31(see my last post of 20.4.2020) on 20-4-2020 and then fell sharply the next day and made a low of 8909.40 thereafter for next three day it traded between the above range and finally ended the week on a relatively weak note at 9154.40. On the daily chart it is still making higher bottom & top in the line chart, but in the bar chart it has made a lower top so it is a weak signal but it is yet to make a lower bottom so watch out for it. However it is still above its short term moving averages on the daily chart, which speaks of some strength. Please note that if it fails to close and sustain above the benchmark point of 9390.31 and then start making lower bottom and top on the line and bar chart then it will be construed that the top is in place and relief rally has exhausted. It may possibly fulfil the conditions of rally exhaustion during the week.     

So, I once again reiterate that 9390.31 level (see my last post) would be the benchmark point and if it move and sustain above it on the closing basis for at least for 3-4 days then it would open upside up to 10000 but moving up it would face huge resistance at 9460/9520-580/9685.55/9687.55/9944.40/9951.90/9958.55/9970.80.

In view of the above observation it seems that the ongoing bear rally has exhausted at 9390.85, but the confirmation of the rally exhaustion is yet to happen and it will only happen on the line chart if it closes below 8981.45 and then do not close above 9313.90 on the up move as of now. Similarly for confirmation on the bar chart it should move below 8909 and then on the up move it should not go beyond 9343.60 even intraday as of now. It will signal severe break down if it sustain below 8672 on the closing basis. Therefore please note that till it confirms the rally exhaustion conditions it may still claw back to 9390.31 or may move above it also. So be vigilant and cautious in both side trades.   

NOTE: - The ongoing relief rally seems to have exhausted at 9390.85 on 20.4.2020 and to prove it otherwise it has to move and close above it and sustain. Therefore as of now the upside benchmark point is 9390.31 and downside benchmark point is 8672.

TRADING STARTAGY      

1. Buy on decline but not below 9070 with a stop loss of below 8970.    

     Since the rally seems to have exhausted, so it could be a risky trade.

2. Sell on the rise near or within the range of 9300—9343 but not above      

    above 9343 with a stop loss of above 9420.

Or

    Sell below 9140 with a stop loss of above 9220.

Or

    Sell below 9070 with a stop loss of above 9155.

Remark: - It is in the bear market and it seems that the ongoing relief rally has exhausted but the confirmation of it is yet to happen, therefore one should be vigilant and careful in long trade till it moves above 3943.60 and then the benchmark point of 9390.31 and sustain. A short trade on the rise or as suggested above seems to be a better option at this point of time. 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.

Contact me for strategic guidance to enter and exit trade.