A TECHNICAL VIEW ON CNX--BANK NIFTY FOR --31.7.2020

CNX--BANK NIFTY

Open-22195.05--High-22252.60--Low-21580.15—Close-21646.85 on 30.7.2020

Support:21580.15/21512.29/21462.40./21222.45/21027.55/20926.45/20316/20122.25/20010/19507.

Resistance:21768/21807.40/21861/21967/21965//22119.35/22222.58/22377.06/22418/22479.55/22670.05/22695.92/23080.60/23211.35.

Critical Points moving up: 21861---22120---22377--- 22418---22479.55---22695.

Critical Points moving down:-21580.15---21542----21464---21027.

(Bold and underlined figures are most important)

As envisaged it broke the recent bottom of 21611.40(see my post for 30.7.2020) and made new low of 21580.15 today. It is terribly weak on the technical charts on almost all major parameters therefore it seems that further fall is ahead. Moving down it will find support at 21580---21543---21464 levels and sustained break below 21464 on the closing basis may take it down to 21000 levels or below. Some of the technical indicators have given strong negative divergence which indicates that the steep fall cannot be ruled out and it may seek much lower levels in coming days.

Since it is in strong corrective mode, it is therefore suggested to avoid long trade completely till it gives strong and visible indication of a bottom formation at the lower levels. Therefore it is advised to have patience and not to be in a hurry to try long trade in anticipation or on whim and fancy till clarity on bottom formation emerges otherwise it can trap the traders miserably. Since correction is on therefore sell on the rise strategy should be adopted as of now or sell on the price breakdown for taking advantage of the down move. Avoid long trade completely as of now.

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

2. Sell if it moves below 21580 with a stop loss of 21720 for a target of 21464----21340---21027----20926.

Or

Sell on the rise near or within the range of 22150--22250 with a stop loss of 22360.

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 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.