A TECHNICAL VIEW ON CNX--BANK NIFTY FOR—20.7.2021

 

CNX--BANK NIFTY

Open-35070.50---High-35347.05--Low—34899.20---Close-35079.20 on 19.7.2021

Support:34976/34930/34859.90/34635.95/34525.45/34410/34374/34287/33990.80/33625/33371/33306.80/32842.30/32613.10/32465.45/32415.15/32347/32157.05/32130/31783.60/31661/31649.49/31297.30/31264.05. 

Resistance;35380/35428.15/35491.95/35584.30/35648/35811/35985.25/36248/36455.15/36497/36615/37232/37708.75.

(Bold and underlined figures are most important) 

It corrected sharply today and closed with a loss of 672.60 points, it moved decisively below its short term moving averages also, which is a weak sign and if it does not bounce back above at least above 35648 in next 2-3 trading sessions then it could further drift down. But going down it has bed of support in the range of 34860---34632---34525---34374---33908, therefore till it holds this range there is no fear of sharp and consistent decline. However it has gotten into very short correction mode today and to get out of it has to move above 35490 else it will move down further and may complete correction at 34943---34699---34397—34322 at any of these points. Please note that break below 34860 could weaken it further and break below 34374 could drag it down towards lower end of the above mentioned support points range and finally break below 33908 could accelerate the fall. The long term bias still looks positive for the uptrend to continue as of now. The short term outlook has got a jolt today and gotten weak; furthermore one very important technical indicator on the daily and weekly chart is showing weakness and if it does not improve fear of fall will always be there and it came into play today and may continue with short relief rallies. So be extremely cautious in the long trade at this point of time.

In view of the above observation, since it has gotten into short correction mode, for safe traders it is suggested to avoid long trade till it gives visible indication of correction completion or closes above 35490. However aggressive traders can try long trade if it moves above 35375 and maintain for some time or can try buy on decline at appropriate points or near 34860 but not below it. Please note that long trade in a weak market could be a risky affair. Since it has not yet crossed some of its critical long term averages and overall short term technical setup is weak as of now, therefore short trade can also be tried after reasonable rise or can be tried on the price breakdown for taking advantage of the intraday or otherwise 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 (Suggested)

1. Buy if it moves above 35375 and maintain for some time with a stop loss of 35180.It is for the aggressive traders and could be a risky trade.

Or

Buy on decline at appropriate points or near 34860 but not below it with a stop loss of 34740. It is for the aggressive traders and could be a risky trade.

2. Sell on the rise near or within the range of 35500---35650 with a stop loss of 35725. It could be a highly risky trade but worth trying for intraday gain.

Or

Sell if it moves below 35060 and maintain for some time with a stop loss of 35160. It could be a risky trade but worth trying.

Or

Sell if it moves below 34860 and maintain for some time with a stop loss of 34940. It could be a risky trade but worth trying.

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.