CNX--BANK NIFTY
Open-21634.25--High-21935.50--Low-21230.55—Close-21340.75
on 15.7.2020
Resistance:21357/21462.40/21768/21807.40/21967/22418--22480/22572.22..
Critical Points moving up: 21357--- 21661---21935---22152---22418---22480---22572.22—23080.60.
(Bold and underlined figures are most important)
As expected it staged a pullback rally today and went up to the 2nd desired point of 21932(see my post for 15.7.2020) but could not sustain and plunged down sharply in the late afternoon and tested its yesterdays low of 21222.45 but did not break it but closed below yesterday’s close with a meagre loss of 51.44 points. It is exhibiting tremendous weakness as it has broken its rising trend line decisively and technical indicators are also pointing towards further fall ahead. But it has fallen for 4 straight days and made double bottom of 21222.45 & 21230.55 therefore as long as it hold these points it could still stage a pullback on the closing basis before resuming the down move again. Break below the said bottom on the closing basis can take it down further and moving down it will find support at 20926---20872---20350---20221---20010 levels and any of these could be the possible correction completion points also, but sustained break below 20010 on the closing basis may signal the end of the uptrend which may please be noted. Similarly moving up for a relief rally if it closes above 21661 and sustain then it could move up further to 21932—22152---22370 levels possibility of which seems slim at this point of time. Looking at today’s move it seems that in all probability the top may be in place at 23080.60 on 8.7.2020 for the time being.
In view of the above observation, the correction is on but in
light of 4 days straight fall and double bottom it could give an up rally on
the closing basis before resuming the down move again. So long trade can be
tried by the aggressive trader if it maintains above 21357 & 21222.45 for taking advantage of a possible pullback rally.
But it is strongly suggested for safe traders to avoid long trade till it gives
visible indication for correction completion. Since the correction
is on therefore it is suggested to adopt sell on the rise strategy or sell on
the price breakdown to take advantage of the corrective move or a rally
breakdown.
Please be alert and vigilant particularly in
long trade because the ongoing rally is purely liquidity driven and not backed
by fundamentals, therefore possibility of ending this rally mischievously is
pretty high. It has already entered into correction mode and may reverse the
trend also in coming days.
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. Day squaring off is strongly suggested in any case.
TRADING STRATEGY
1. Buy if it maintains
above 21357 or 21222.45 for some time with a stop loss of 21180. It is for the aggressive traders only,
because it could be a risky trade.
1. Sell on the rise near or
within the range of 21735--- 21975 with a stop loss of 22160.
Or
Sell if it moves and
maintain below 21222 for some time with a stop loss of 21380. It could be a risky trade
but worth trying.
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
Mobile—8240951127/9831313654.
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Thank you for sharing your views.