A TECHNICAL VIEW ON CNX--BANK NIFTY FOR --20.7.2020

CNX--BANK NIFTY

Open-21608.05--High-22065--Low-21550.80—Close-21966.80 on 17.7.2020

Support:21807.40/21768/21512.29/21462.40/21357/21222.45/21027.55/20926.45/20316/20122.25/20010/19507.

Resistance:21967/22054.22/22169/22296/22418/22480/22572.22/22596.15/22670.05—23080.60.

Critical Points moving up: 22054----22237----22480---22572.22—23080.60.

Critical Points moving down:-21812--21512.29---21357---21027.55---20872--20350.

(Bold and underlined figures are most important)

The pullback rally continued today and it crossed its first resistance point of 21812(see my post for 17.7.2020) and closed at 21966.80 with a gain of 369.65 points. In light of today’s move  it is likely that the pullback rally may continue for few days and moving up it will face resistance at 22054—22237---22297---22572.22---22597---22670.05 levels. Please note that sustained break above 22670.05 on the closing basis can take to its previous high of 23080.60 or beyond. It is terribly weak on technical ground in comparison with Nifty-50 and if it does not move above the mentioned resistance points in the next 3-4 days and sustain on the closing basis then it could possibly resume the down move again. Going down it will find support at 21812---21512.29---21357---21027.85---20926.45.  Please note that sustained break below 21512.29 on the closing basis will signal the end of the pullback rally and break below 21357 will accelerate the fall, which may please be noted.

In view of the above observation, it is still in corrective mode, but the pullback rally is on now, as you are aware that the pullback rallies are treacherous in nature and can end abruptly and technically also it is on a weak footing, therefore for safe traders it is suggested to avoid long trade till clarity on correction completion emerges, so they should still look for short trade opportunity at higher levels or on the price breakdown for taking advantage of the down move. However aggressive day traders can try long trade if it maintains above 22065 or on decline but not below 21812.

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 on decline but not below 21812 with a stop loss of 21700. It is for the aggressive traders because it could be a risky trade.

Or

Buy if it moves and maintains above 22065 for some time with a stop loss of 21940.

2. Sell on the rise near or within the range of 22572----- 22670 with a stop loss of 22850. It could be a risky trade but worth trying.

Or

Sell if it moves and maintain below 21512 for some time with a stop loss of 21620.

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

suranank@gmail.com

Mobile—8240951127/9831313654.