A TECHNICAL VIEW ON CNX--BANK NIFTY FOR --30.7.2020

CNX--BANK NIFTY

Open-22075--High-22346.40--Low-21906.35—Close-22076.60 on 29.7.2020

Support:21989/21967/21861/21807.40/21768/21512.29/21462.40./21357/21222.45/21027.55/20926.45/20316/20122.25/20010/19507.

Resistance:22119.35/22222.58/22377.06/22418/22479.55/22670.05/22695.92/23080.60/23211.35.

Critical Points moving up: 22222.58--- 22418---22479.55---22600---22834---22892.

Critical Points moving down:-21989---21861---21611---21542----21464.

(Bold and underlined figures are most important)

It did break its important point of 21989 (see my post for 29-7-2020) intraday but managed to close above it. It is looking weak on the technical chart as it has made lower top and bottom on the line chart, well below its short term moving averages on the daily chart and far below its long term moving averages on the daily and weekly chart both which indicates gross weakness. Therefore it seems that the bottom of 21611.40 it made on 28.7.2020 may not be lasting and may be taken out in coming days. The overall setup looks weak.

In view of the above observation, it on a weak technical footing, so correction may still deepen, therefore long trade should be avoided till it gives strong indication of a reasonably strong bottom formation. As it is respecting its important point of 21989 so, aggressive traders if they wish to can try long trade above 21989, but it could be a risky trade. Since  It seem on a sticky note therefore short trade should be attempted on the rise or on the price breakdown for taking advantage of the down move. It is important to mention here that sustained break below 21989 on the closing basis can take it down to 21861---21611---21543---21464 levels which may please be noted. Safe traders should avoid long trade today. 

 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 near but not below 21989 if it holds it for some time with stop loss of 21900. It is for the aggressive traders and could be a highly risky trade.

2. Sell if it maintain below 21989 with a stop loss of 22120.

Or

Sell if it moves and maintain below 21848 with a stop loss of 22000.

Or

Sell on the rise near or within the range of 22450---22580 with a stop loss of 22650.

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.