A TECHNICAL VIEW ON CNX-NIFTY FOR --31.7.2020

CNX-NIFTY

Open-11254.30--High-11299.95—Low-11084.95—Close-11102.15 on 30.7.20203

Support:11118/11108/11098.70/11056/10953/10894.05/10847.85/10813.10.

Resistance: 11157.67/11171.55/11239.80/11270/11341.40/11348/11429.85/11446.42.

Critical Points moving down:-11044---10952---10860---10746---10718.

Critical Points or range moving up: -11157.67---11171.55---11239.80---11270---11341.40---11446.62.

 (Bold and underlined figures are most important)

As envisaged it gave downside breakout from the range of 11157---11270  (see my post for 30.7.2020)  today therefore it seems that it has slipped into the correction mode and if it sustain below 11157.67 on the closing basis then correction could deepen and it may last for few days. Looking at last 3-4 days trading session chances of down move accelerating seems pretty bright. Moving down it may find support at 11113--- 11044---10952---10860---10746---10718 levels, it may bounce back from any of these point but if it breaks 10718 levels and sustain on the closing basis then it could go down to 10560 levels or below. Similarly moving up it has three critical resistance points at 11157.67---11240---11270 and to regain the up momentum again it has to move above all these points and sustain on the closing basis but looking at today’s breakdown, it seems an uphill task as of now.

In view of the above observation, since correction has begun today, therefore long trade should be avoided till it gives visible indication of a bottom formation at the lower level or try it if it clears the critical points of 11157.67---11240---11270 and sustain on the closing basis, because then only it will pick up strong up momentum. It is therefore suggested to have patience and do not be in a hurry to initiate 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 corrective move or may be a possible rally breakdown advantage. 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

1. Sell if it moves below 11080 with a stop loss of 11170 for a target of 11044---10952—10860.

Or

Sell on the rise near or within the range of 11190---11240---11300 with a stop loss of 11360.

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.