A TECHNICAL VIEW ON CNX-NIFTY FOR –27.8.2020

 

CNX-NIFTY

 Open-11512.85--High-11561.75—Low-11461.85---Close-11549.60, on 26.8.2020.

Support:11460.35/11447/11378/1341.40/11289.80/11270/11239.80/11171.55/11111.45/11056.55/10894.05/10882.

Resistance: 11562/11565/11598/11626/11694.85/11736.

Critical Points moving down: 11536---11460.35---11447---11373.60---11341.40---11289.80.

Critical Points moving up: -11598---11640---11694.85—11706.65---11761.

(Bold and underlined figures are most important)

It is showing tremendous strength and steadily moving up; therefore there is no threat to the ongoing uptrend as long as it holds the benchmark point of 11447. The up journey seems to continue as of now but with intermittent correction and resistance at various points on the way up. The possible resistance points could be 11614---11695---11761---11802—11856.The uptrend may face potential threat once its break 11289.80(this figure can change) as of now and close below it. But be alert if it starts giving close below 11447.

In view of the above observation long trade can be tried on decline if it maintains above 11447 or can be tried if it moves and maintains above 11562. It is strongly suggested to avoid trying short trade in general but it should be attempted after a reasonable rise near or within the appropriate range or on the price breakdown for taking advantage of corrective move or for taking possible rally exhaustion advantage.

It is imperative to mention here that the ongoing surge in the Indian as well in the rest of the world stock market for the last few months is not at all fundamentally backed but purely liquidity driven which is concerning. In light of this instead of caution it seems that there is an irrational exuberance in the stock market now which is even more concerning. Please take my word that at this juncture if investors and traders do not exercise extreme caution and alertness particularly in the long trade then they are surely going to be trapped in coming days. One cannot time the correction but it seems that it is around the corner.                                                                                                                                                                                                                                                                                                                                                       

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 11447 with a stop loss of 11400.

Or

Buy if it moves and maintain 11562 with a stop loss of 11510. It could be a risky trade.

2. Sell on the rise near or within the range of 11650---11695 with a stop loss of 11750. It could be a risk trade.

Or

Sell if it falls below 11447 and maintain below it for some time with a stop loss of 11510.

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.