Commodities

Thursday, 25 March 2021

A TECHNICAL VIEW ON CNX-NIFTY FOR—26.3.2021

 

CNX-NIFTY

 Open—14570.90--High—14575.60—Low—14264.10---Close-14324.90on 25.3.2021.

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

Resistance:14350.10/14467.75/14653.35/14695.25/14753.55/14823.07/14862.10/14888.80/14977.20/14998.80/15069/15102/15165/15176.50/15273.15/15305/15325/15369/15431.75/15471/15615/15694/15800/16028/16323/16991.50/17470.                                                                                                                

 (Bold and underlined figures are most important)

As expected the pullback rally got exhausted (see my post for 22.3.2021) at 14878.80 on 23.3.2021 and started down move again and it hit a low of 14264.10 today and closed with a loss of 224.50 points. It is exhibiting huge weakness therefore further fall may be ahead in coming day. 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 for few day now  therefore it was already  into  deep short term correction mode which could last for 4-7 days or more, it has broken its 4th key point of 14336.34 today therefore now it is  into medium term correction mode which could 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.

It was already into deep short term correction mode and today it has slipped into medium term correction mode which is bad sign. Furthermore it has decisively broken its short and medium term moving averages and some long term technical parameters also, which indicates that further fall is ahead with intermittent short relief rallies in coming days. Please note that if it sustains below 14336.34 on the closing basis then the correction could deepen and it could be more painful also pricewise and time wise both. It is important to mention here that now the pullback rally threshold point is at 14540(it can change), if it closes above this point and sustain then it could give a reasonable pullback rally, else down move will continue with very short up move below this point. Kindly note that chances of significant up move from here looks slim at this point of time, however moving up it will face critical resistance at-14350.10---14467.75---14540---14653.35---14753.55---14878.60---14986---15156.30---15198.30. Similarly going down it can find support at-14264.10---14222.80---14024.85---13996.11---13981.75---13953.75---13777.50---13596.75---13562.50. It seems that it is the process of changing the trajectory from uptrend to the downtrend provided it does not bounce back sharply in next couple of days, chances of sharp bounce back looks less likely at this point of time. Kindly, note that the short term technical setup and parameters are tremendously weak. Therefore short term bias is negative as of now.

In view of the above observation, it was in deep short term correction mode and today it has gotten into medium term correction mode which is even bigger bad sign therefore, long trade in general should be avoided till it gives visible indication of correction completion. Long trade can only be attempted once it closes above the pullback threshold point of 14540 else avoid. However aggressive traders can try long trade on decline and the possible buy point for the day could be near 14222---14136 & 14024.85 avoid buying below 14024.85 for sure because below this point it could go for an accelerated fall.  Please note that long trade in deep corrective mode could be a risky proposition. Since it is 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 on decline near 14222 or near 14136 or near14024.85 but not below it with a stop loss 14190, 14110 & 13970 respectively. It is for aggressive traders and could be a risky trade.

2. Sell on the rise near or within the range 14540---14575 with a stop loss of 14610. It could be a risky trade but worth trying in a corrective market for intraday gain.

Or

Sell if it remains below 14350 for some time with a stop loss of 14380. It could be a risky trade but worth trying for intraday gain.

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.

 

 

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