A TECHNICAL VIEW ON CNX--BANK NIFTY FOR –6.8.2020

CNX--BANK NIFTY

Open-21686.85--High-21936.50--Low-21448.40—Close-21509.95 on 5.8.2020

Support:21462.40/21375/21122.10/21031.45/21027/20926/20501/20324.

Resistance:21546/21611.40/21768/21807/21865/21967/22338.

Critical Points moving up: 21546---21640---21865---22338.

Critical Points moving down: - 21464---21375---21027---20926---20501.

(Bold and underlined figures are most important)

It gave a robust up move by more than 440 points intraday today from its previous days close, but could not sustain at the higher levels and closed with a small gain of 19.45 points. Furthermore despite huge intraday up move it is still below its critical points of 21537 & 21546(it can change) which indicates gross weakness in it. Therefore if it does not move above these points in next 1-2 trading session on the closing basis then the up move may fizzle out and it can resume down move again.

In view of the above observation, since it is giving terribly weak indication, therefore long trade should be avoided till it closes above 21546 and sustain. It means long trade is a complete avoid for the day. Since price movement is exhibiting weakness and the erratic and volatile move in it may end the up rally at any time, therefore till it closes above 21546 short trade can be attempted on the rise in the appropriate range or on the price breakdown for taking advantage of corrective move or may be for a possible rally breakdown advantage.

 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 21440 and maintain for some time with a stop loss of 21560.

Or

Sell on the rise near or within the range of 21950---22200 with a stop loss of 22300. It could be a risky trade but worth trying.

Or

Sell if it moves below 21375 and maintain for some time with a stop loss of 21460.

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.