A TECHNICAL VIEW ON CNX--BANK NIFTY FOR—5.4.2021

 

CNX--BANK NIFTY

Open-33588--High-33949.15--Low—33208.75--Close-33858 on 1.4.2021

Support:33665/33625/33361/32842.30/32718.75/32613.10/32465/32415/31725.85/31650.90/31510.25/31297/31264/30945.20/30893.65/30197.85/29687.70

Resistance;34360.05/34568/34658.70/34803.60/34893.25/34973/35428.15/35584.60/35648/35815.75/35884/36086/36397/36455/36466/36477/36615.20/36647/36897/37170/37284/37708.25/38286/38520.

(Bold and underlined figures are most important)

It exhibited huge volatility during preceding week but finally ended the week with a gain of 539.80 points, which is slightly positive sign. But it is still way below some of its key points and if it does not bounce back above those points and sustain on the closing basis then it could start moving down again in coming days, which may please be noted. Please note that its critical and most important points for the year 2021 are 32613.10---32465.45---31297.30 & 31264.05 and it is  above these points now and as long as it hold these points on the closing basis uptrend will remain intact. Its other key points are placed at 36063.50---35815.75---35648---33625---32612.92(figures can change). It is decisively below its first 3 key points of 36063.50---35815.75  & 35648  for last few days so it is already into deep short term corrective mode  , which can last for 4-7 days or more. It is doing whip-saw around 33625 which is the threshold point of getting into medium term correction mode and sustained break below this can push it into medium term correction mode which can last even longer, lastly and most importantly sustained break below 32612.92 on the closing basis can push it into long term correction mode and can potentially threaten the uptrend also which may please be noted. 

It is still into deep short term correction mode despite the up move today. It is still below its short and medium term moving averages and some long term technical parameters also and most importantly it has decisively broken its long term rising trend line on 24-3-2021, which indicates that further fall may be ahead but with intermittent short relief rallies in coming days. However it is above its pullback threshold point of 33665(figure can change) so, as long as it hold this level chances are that it could move up in coming days. Going up it will face resistance at-33991---34360.05---34438---34658.70---35062---35687---35815.75---36460---36650 levels. Please note that it may rise from here but a significant rise is not likely at this point of time, furthermore the on-going up move is a pullback rally and chances are that it can fizzle out at any of these points, so be watchful in long trade. It is important to mention here that  sustained break below 33625 on the closing basis could push it into very deep  correction mode and it could be more painful also pricewise and time wise both and it could hit 30500—30000 level on the downside. Similarly going down it can find support at-33665---33625---33303---33151---33006---32842---32612.92---32465.45---32415.25---31650---31297---31264. Kindly, note that the short term technical setup and parameters are tremendously weak. Therefore short term bias is negative as of now, but the long term bias is still up.

In view of the above observation, it is still into deep short term correction but in the pullback mode also therefore for safe trader long trade in general should be avoided till it gives visible indication of correction completion. However the traders who wish to take advantage of the pullback rally can try long trade if it moves and maintain above 33991 for some time or on decline but not below 33665.  Please note that long trade in deep corrective mode and for pullback gains could be risky propositions. Since it is still in corrective mode but pullback rally is also on therefore short trade can also be attempted after reasonable rise or 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 33665 with a stop loss of 33540. It could be a risky trade.

Or

Buy if it moves and maintain above 33991 for some time with a stop loss of 33820. It could be a risky trade.

2. Sell if it remains below 33625 with a stop loss of 33880. It could be a risky trade but worth trying for intraday gain in weak market.

Or

Sell on the rise near or within the range of 34400---34500 with a stop loss of 34600. It could be a risky trade but worth trying for intraday gain in corrective market.

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.