A TECHNICAL VIEW ON CNX--BANK NIFTY FOR THE WEEK STARTING FROM-- 15.6.2020

CNX--BANK NIFTY

Open-19529.30--High-20747.70--Low-19526.10—Close-20654.55 on 12.6.2020

Support:20530.45/20324/20184.10/20122.25/20010/19852/19728.90/19586/19526.10/19515/19455.55/19358.05/19297.25/19051/19010/18941/18703.45/18252.43/18100/17938/17719/17606/17311.25/17286.40/17248.48/17143/17105.

Resistance:20697.63/20820/20995/21122.10/21348.15/21462.40/21619.55/21670/21807.40/21967/22380/22418/22469/22996.40/23609.40/23822/23923.30/24045/24240.

Critical Points:--20010--20530.45—20697.43--21100.10--21462--21967.

(Bold and underlined figures are most important)

Further to my last post of 8.6.2020, it exhibited huge volatility and gave both side wild swings in the preceding week but closed reasonably well. It is far lagging behind in technical strength in comparison with CNX-Nifty.

On the last day of the week it opened with a huge gap down at 19529.30 and made a low of 19526.10 and then made a high of 20747.70 for the day before ending the day near the high at 20654.55.

It started correcting on the 4thday of the week and today it strongly corrected intraday but closed on a positive note. It is important to mention here that the real corrections are on the closing basis therefore todays strong up move after intraday huge down slide seems well orchestrated or may be a fake up move, if it is so then it may not last and can fizzle out in 1-2 days because it is making lower top and bottom on the line chart and is far-far below its all long term moving averages on the daily and weekly chart. So it seems that correction is still on and will only complete when it starts making higher top and bottom i.e. it closes above 21100.10 and then on the down move should not break 20525.15 as of now (the top & bottom figures will change if it makes another lower top & bottom) and if it is in a strong corrective mode then it may not close above 20724.90 levels even.

In view of the above observation it seems that the correction is not yet over therefore for safe traders long trade should be avoided till it starts making higher top and bottom and stays above all its critical points of  20010---20530.45 & 20697.43 on the closing basis, it is still below one of its critical point. Moving up it will face stiff resistance from its tops and bottom at 20697.43—20820---20995---21122.10---21462---21807.40---21967---22380---22418. It may rise further if it moves above 22418 and sustain on the closing basis. Since the correction is supposedly on therefore short trade should be attempted on the rise near or within the critical range or on the price breakdown. Moving down it will find support at 20530.45---20316---20122.10---20010---19887---19728.90---19526.10---19297.25---19051.95---18941---18880---18287. Please note that as it is already below one of its critical point of 20697.43 so it is a weak sign and sustained break below 20010 will accelerate the down move. 

NOTE: - If it opens up with huge gap up then wait for it to settle down before initiating long position, but short trade can be attempted on huge gap up if it is near the selling point and vice versa . Since, it is showing volatility so any type of trade should be squared off during the day, if you don’t have reasonable profit margin in the trade.

TRADING STRATAGY

1. Buy if it maintain above 20697.43 for some time with a stop loss of 20490.It could be a risky trade.

Or

   After it closes above 21100.10 then buy on decline but not below 20697.43 with a stop loss of 20500.

2. Sell on the rise near 21250(S/L-21300), 21570(S/L-21620), 21950(S/L-22100), 22450(S/L-22550)

Or

Sell if it does not move above 20697.43 in first two hours of trade with a stop loss of 20850.

Or

Sell if it maintains below 20530.45 for some time with a stop loss of 20720.

Or

Sell if it maintains below 20010 for some time with a stop loss of above 20120.

Remark: - The long term trend is still down. Short term trend is up but it is in corrective mode therefore long trade is not suggested till the above mentioned conditioned are fulfilled. However aggressive trader can try long trade as suggested above with extreme caution and care as the ongoing up rally is not fundamentally backed therefore chances are that it may end abruptly also and it has shown trailer of it on 12.6.2020. Therefore short trade should also be attempted as suggested above. The short term bias is up.   

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.

 Thanks. 

 Narendra Kumar Surana

 E-mail—suranank@gmail.com

 Mobile—8240951127/9831313654.