A BROAD TECHNICAL VIEW ON CNX--BANK NIFTY FOR THE WEEK STARTING FROM- 26.5.2020

CNX--BANK NIFTY

Open-17554.25--High-17952.25--Low-17105—Close-17278.90 on 22.5.2020

 

Support:17286.40/17248.48/17143/17105/16826/16450/16193/16116.25/15879.55/15626/15440/15157/14853.

 

Resistance:17286.40/ 17400/17890/18175/18252.43/18941/18962.28/19051/19200/19635/19769/19881/19934/20010/20260/20514.75/20586.22/21122.10/21348.15/21462.40.

 

 (Bold and underlined figures are most important)

 

It opened with a down gap at 17554.25 and made a high of 17952 then slipped down sharply and made a low of 17105 and ended the day at 17278.90 with a loss of 456.19 points. It is exhibiting extreme weakness on the charts for quite some time which is a bad sign and indicates that down side may be wide open.

 

Although it is showing tremendous weakness on all technical parameters but it has important support at 17248 &17105, furthermore it has retraced more than 80% from the recent top of 21967 and bottom of 16116.25 and has taken support at its important points, so it may possibly stage a short up move from here before breaking these levels and retest or break the bottom of 16116.25. Moving up it will face very stiff resistance at 17400---17890---18175----18252.43. Kindly note that if it maintains above 17400 it could inch up higher but it will only gain some strength if it moves above 18175----18252.43 and sustain on the closing basis.

 

It is important to mention here that the long and short term trend both are down therefore for safe trader long trade is  a complete avoid as of now ,however aggressive trader who wish to take advantage of the possible short up move may try long trade but mind you it could be a  risky  affair. It is therefore suggested to adopt selling on the rise strategy till some strength is visible.  

 

TRADING STRATEGY     

1. Buy if it maintain above 17248 with a stop loss of below 17000. It could be a risky trade.

    

2. Sell on the rise in the range of 17890---18175----18260 with a stop loss of 18430.

Or

 Sell if it maintains below 17248 with a stop loss of 17400.

Or

Sell if it maintains below 17105 with a stop loss of 17300.

IMPORTANT NOTE:- The benchmark point as of now is 17248 and if it sustain below it on the closing basis then it will definitely break the bottom of 16116.25 and open the downside up to 13407 levels which may please be noted.

Remark: - The long term trend is down. It looks extremely weak technically; therefore long trade should be completely avoided by the safe trader but aggressive trade can try long trade as suggested above. Short trade seems to be a better option therefore should be attempted as suggested above. The long term bias is hugely 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.