A TECHNICAL VIEW ON CNX-NIFTY FOR—22.3.2021

 

CNX-NIFTY

 Open—14471.15--High—14642.80—Low—14350.10---Close-14on 19.3.2021.

Support:14467.75/14350.10/14222.80/13953.75/13777.50/13596.75/13399.30/13145.85/13131.45.        

Resistance:14653.35/14695.25/14753.55/14823.07/14862.10/14888.80/14977.20/14998.80/15069/15102/15165/15176.50/15273.15/15305/15325/15369/15431.75/15471/15615/15694/15800/16028/16323/16991.50/17470.                                                                                                                

 (Bold and underlined figures are most important)

It opened on a negative note and broken its recent major bottom of 14467.75 and went down further and made a low of 14350.10 thereafter it bounced back sharply and closed with a handsome gain of 186.15 points. Please note that if it maintains above 14605.40 on the closing basis then this rally can last for few days which may please be noted. Its most critical points for the year 2021 are 14024.85---13996.11 & 13981.75 and it is way above these points now and as long as it holds these points on the closing basis uptrend will remain intact. Its other key points are at 15131.35---14998.70---14888.80---14336.34---13562.48---12430.50(except for 12430.50 other figures can change). It is decisively below its first 3 key points of15131.35---14998.70 &14888.80  therefore it is into  deep short term correction mode now and it can last for 4-7 days or more, sustained break below 14336.34 on the closing basis will push it into medium term correction mode and it can last even longer and most importantly sustained break below 13562.48 on the closing basis can push it into long term correction mode and will potentially threaten the uptrend and finally sustained break below 12430.50 on the closing basis will further dampen the uptrend for sure, which may please be noted.

Kindly note that even after today’s sharp recovery it is still into deep short term correction mode, the sharp rally today may be due to the short covering also and if it is so then it is likely to fizzle out in next 1-2 days. However as long as it holds the level 14605.40 it could continue the effort to move up further. Please note that to come out of the correction mode completely it has to moves above 15131.35 and sustain on the closing basis and for a steady and sustained rise it has to move above 15215.45 and sustain on the closing basis then only, it can expect to retest its all-time high of 15431.75 or may go beyond. In the process of crossing the above important points it will face very tough resistance on the way at-14753.55---14789---14888.80---14998.70---15131.35---15177---15215.45---15273.15---15336.30---15431.75 levels, crossing these hurdles  seems  pretty tough at this point of time, therefore chances are that this rally may get exhausted at any of these points or earlier also and may start down move again. Going down its critical support points would be at 14635.05---14605.40---14467.75---14350---14336.34---14222.80---14024.85---13996.11---13981.75---13777.50---13596.75 levels. It is important to mention here that sustained break below 14467.75 and then below 14336.35 on the closing basis can drag it down with an accelerated pace, which may please be noted.  Kindly, note that the short term technical setup is weak. The short term bias is negative as of now.

In view of the above observation, in spite of robust bounce back today, it is still in correction mode therefore, long trade in general should be avoided till it gives visible indication of correction completion. But since it is well above its pullback threshold point of 14605.40 therefore as long as it holds the aforesaid level those traders who want to take advantage of the pullback move can try long trade at appropriate points or on decline but not below 16605.40 . Please note that long trade in deep corrective mode could be a risky proposition. It is still in corrective mode therefore adopt sell on the rise strategy or sell on the price breakdown for taking advantage of the down move till clarity on correction completion emerges. Short trade should be tried but with extreme alertness and caution because the long term technical setup still seems o.k. 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(Suggested)

1. Buy at appropriate points if it holds the level 14605.40 for some time with a stop loss of 14560.

2. Sell on the rise near or within the range 14860---14920 with a stop loss of 14950. It could be a risky trade but worth trying for intraday correction.

Or

Sell if it moves and sustain below 14560 for some time with a stop loss of 14620. It could be a risky trade but worth trying for intraday correction.

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.