A TECHNICAL VIEW ON CNX--BANK NIFTY FOR---20.11.2020

 

CNX--BANK NIFTY

Open-29302.60--High-29627.20--Low-28819.55—Close-28903.05on 19.11.2020

Support:28525.45/27754.45/27589/27164/26950/26545.70/26492/26408/26311.30/25953.50/25891/25723.55/25426.75/25232.60/25199/25105.35/24823.60/24617.15/24364.

Resistance:29030.90/29156.25/29314/29435.05/29612.55/29784.75/30121.75/30220/30649/30801/30899/30996/31649.45.

(Bold and underlined figures are most important)

It has decisively broken its benchmark point of 29314 and first key point of 29293.50; therefore it has slipped into very short correction, however it is still above other key points of 28328---27571---26559, (the figures can change), looking at today’s move it seem that if it does not bounce back above 29314 and sustain on the closing basis correction may deepen in coming days. So please note that sustained break below 28328 on the closing basis will push it into short term correction mode, sustained break below 27571 will push it into medium term correction and most importantly sustained break below 26559 can push it into long term correction mode and will potentially threaten the uptrend also, which may please be noted. The overall technical setup is still looking good but certain technical indicators are showing negative divergence and if that comes into play then it could witness sharp fall and correction may last for some time, therefore it is suggested to avoid long trade till it moves and sustain above 29314 on the closing basis or after reasonable decline where correction completion looks visible.  

Moving down its critical support points at 28744---28498---28328---28119---27703.

Moving up its critical resistance points at 28989---29030.90---29314--29851---30220---30649---30801---30899---30996---31649.

In view of the above observation for safe traders long trade should be avoided on the decline for the day and can only be tried if it moves and maintain above 29314 on the closing basis. But aggressive traders can try long trade on decline near 28328 but not below it or if it maintains above 29031 for some time, but in light of today’s drastic fall any type of long trade could be a risky trade for the day which may please be noted. Since it slipped into very short correction and some other technical parameters are indicating that correction may deepen, therefore short trade can be attempted after a reasonable rise or on the price breakdown for taking advantage of the corrective move.

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 at appropriate points or near 28328 but not below it with a stop loss of 28240.It is for aggressive traders and could be highly risky trade.  

Or

Buy if it moves and maintains above 29031 for some time with a stop loss of 28890. It is for aggressive traders and could be highly risky trade.  

2. Sell on the rise near or within the range of 29314--29400 with a stop loss of 29475. It could be a risky trade but worth trying for intraday corrective move.

Or

Sell if it moves and maintains below 28819 for some time with a stop loss of 28920. It could be a highly risky trade but worth trying for corrective move.

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 favorable  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.