Open-11478.55--High-11554.75—Low-11430.40---Close-11,
on 2.9.2020.
Support:11495.20/11447/11378/11325.85/11289.80.
Resistance: 11633/11694.85/11736/11761/11794.25/11825/11882.
Critical Points moving down: 11495.50---11447---11373.60---11341.40---11289.80.
Critical Points moving up: -11597---11633---11675—11761---11794.25---11840---11930.
(Bold and underlined figures are most important)
After the significant decline on 31-8-2020, it bounced back above its benchmark point of 11447 on 1-9-2020 and still maintaining above it which is a positive sign,
but it is well below its major rising trend line which is concerning, however
as long as it maintains above 11447
on the closing basis there is a possibility that it can resume the uptrend in
coming days else it will continue the down move. Moving up it will face stiff
resistance at 11597---11633---11761---11794.25—11840,
if it moves and sustain above 11840
on the closing basis the up move may accelerate. Similarly moving down it will
find support at 11447---11373.60---11325.85---11289.80---11111.45,
sustained break below 11447 can put
the uptrend in danger and can slide to any of these levels or below.
In view of the above observation long trade can be tried on
decline near but not below 11447 or
can be tried if it moves and maintains above 11555 for some time. Although it is above its key point of 11447 but not exhibiting the required momentum after the severe fall therefore short
trade can also 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 advantage of possible
rally breakdown.
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 11380.
Or
Buy if it moves and maintain 11555 for some time with a stop
loss of 11500. It could be a risky trade.
2. Sell on the rise near or within the range of 11650---11700 with a
stop loss of 11750.
Or
Sell if it falls below 11410 and maintain below it for some time
with a stop loss of 11460.
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
Mobile—8240951127/9831313654.
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Thank you for sharing your views.