A TECHNICAL VIEW ON CNX--BANK NIFTY- 13.4.2020

CNX--BANK NIFTY

Open-19553.15--High-19988.30--Low-19166.90—Close-19913.60 on 9-4-2020

Support:-19812.46/19302/19144/19122.10/18793.13/18162.53/18029/17606/17248.42/16946/16116.25.

Resistance:-20010/20324.10/20443/20608/21168/21462.40/22418-469/22996.40/23605.60.

 (Bold and underlined figures are most important)                                                                       

It is in bear phase but gave a good pullback rally during the week ended on 9-4-2020; it hit a high of 20324.10 and closed at 19913.60. But this rally was not strong enough to ensure that it may last for few days. However it has bounced back above some of its short term moving averages on the daily chart, furthermore in the line chart it has made higher bottom and higher top but yet to make a higher top in the Bar chart, in fact it is far below its recent top of 21462.40 on the bar chart , therefore for this rally to continue it has to at least move above its critical point of 20010 and sustain on the closing basis then only it may be expected that the ongoing rally will last and may hit or cross the level of 20325/20608/21168 & 21462.40 else this rally may fizzle out anytime. It is important to note that to gain some strength it has to bounce back above its major rising trend line on the monthly chart which is placed at 21950-22010 for the month of April-2020. Please note that if does not move and close above the key figure of 20010 and break the level of 18946 on the closing basis then that will be the potential sign of the rally exhaustion.

Although some short term signal are slightly positive but not enough to create confidence that this up move will last, because the long term technical parameters are still very bad. Therefore long trade should be avoided till it closes above 20010. However those who wish to take chance can try long trade on decline near but not below 19225 with a stop loss of below 18920, mind you that it could be a risky trade. Similarly If it opens on the upside with gap on 13.4.2020 then short trade can be tried near but not above 20325 with a stop loss of above 20450 or if does not move above 20010 in first one and half hour of trading then short trade can be tried with a stop loss of above20100. Please note that both short & long trade seems risky at this point of time but sell trade at appropriate points seems a better option now till it gives price-wise confidence for long trade. Most importantly its chart pattern is very weak in comparison with CNX-Nifty. Therefore caution is required in the long trade.

Remark: - The trend is down and strongly bearish, the relief rally is on but in view of the above observation as of now it seems that this rally may not last. Therefore it is suggested to avoid long call till it closes above 20010 instead look for an opportunity for sell trade at this point of time. The 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.