A TECHNICAL VIEW ON CNX--BANK NIFTY FOR—5.5.2021

 

CNX--BANK NIFTY

Open-32610.40--High-33011.55--Low—32191.40--Close-32270.35 on 4.5.2021

Support:32157.05/32130/31783.60/31661/31649.49/31297.30/31264.05/32260/31015/30915/30870/30843/30669/30648/30540/30338.35/30220.20/29687.70/29612.55/29156/28976.75/28525.45/28388.65/27652/26641—560/26441/25598.

Resistance;32347/32415.15/32465.45/32613.10/32842.30/33306.80/33371/33625/33990.80/34287/34360/34430/34658.70/34893/34976/35428.15/36455.15/36497/36615/37232/37708.75.

(Bold and underlined figures are most important) 

It opened with a small up gap and went up further but could not sustain at the higher level and plunged down in the afternoon session to close with a loss of 195.40 points. It slipped into long term correction mode yesterday and  below it most critical and important point of 32613.10 & 32465.45 for the year 2021 which is a very weak sign. But it is still holding the pullback threshold point of 32130 and as long as it hold this point on the closing basis there is some hope that it may resume the pullback rally again, but sustain break below this point could trigger  steady down move, which may please be kept in mind. It is important to mention here that its long term downtrend line is placed at 34060 (this figure will decrease every day) for the day and  sustained upside breakout from this line will somewhat ensure the strong up momentum. The   range for the day is 32613.10---32465.45---32130 on the closing basis. Please note that sustained close below 32613.10 will indicate distinct weakness in it and sustained close below 32130 may accelerate the fall which may be kept in mind. Similarly sustained close above 32613.10 may give it some strength to continue the up move.

Critical Support points are at: 32130---31889---31606---31297---31264.

Critical Resistance points are at:--32346---32465.45---32613.10--32804---33195.43—33371---33625----34057---34170---34287---34919---35430---35985---36248.

Kindly note that the on-going down move is a correction within the pullback range and as long as it holds the long term pullback threshold point of 32130 chances of up move shall remain, but the way it has behaved in the last two days chances of moving up is getting murkier.  I caution you here that long trade below the key points of 32613.10 32465.45 could be a highly risky proposition which may please be noted. Please note that from here bias seems mixed but with a slight tilt towards downside. It is important to mention here that technical indicators on the weekly chart are giving indication that major fall cannot be ruled out in coming days if these indicators does not improve fast.

In view of the above observation for safe traders long trade can only be tried if it moves above 32613.10 and sustain on the closing basis. However aggressive traders can buy on decline near 32130 but not below it or if it moves above 32613.10 and sustain for some time intraday, but both the trade could be a risky trade mind you.  Since it is into long term corrective mode today therefore short trade can also be tried after the reasonable rise or can be tried on the price breakdown for taking advantage of the down move till clarity on correction completion emerges.

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 32130 but not below it with a stop loss of 32000. It is for aggressive traders and could be a risky trade.

Or

Buy if it moves above 32613.10 and maintain for some time with a stop loss of 32400.  It is for aggressive traders and could be a risky trade.

2. Sell on the rise near or within the range of 32975---33075 with a stop loss of 33175. It could be a risky trade but worth trying for intraday gain.

Or

Sell if it moves below 32130 and maintain for some time with a stop loss of 32280. It could be a risky trade but worth trying for intraday gain.

Or

Sell if it does not move above 32613.10 in first one hour of trade with a stop loss of 32700. 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.