A TECHNICAL VIEW ON CNX--BANK NIFTY FOR—22.7.2021

 

CNX--BANK NIFTY

Open-34791.15---High-34894.15--Low—34357.35---Close-34415.45 on 20.7.2021

Support:34410/34374/34357.35/34322//34287/33908.95/33625/33371/33306.80/32842.30/32613.10/32465.45/32415.15/32347/32157.05/32130/31783.60/31661/31649.49/31297.30/31264.05. 

Resistance;34525.45/34635.95/34859.90/34930/34976/35380/35428.15/35491.95/35584.30/35648/35811/35985.25/36248/36455.15/36497/36615/37232/37708.75.

(Bold and underlined figures are most important) 

It continued the down move today and closed with a loss of 663.75 points. It is well below its critical point of 36248 & 35811, it is decisively below its short term moving averages, it has broken multiple bottoms on the line chart and multiple bottoms on the bar chart, therefore all together it is exhibiting weakness in the short term. Please note that if it does not bounce back above at least above 35400 in next 1-2 trading sessions and sustain then it could further drift down. But going down it has good support in the range of 34410---34374---34322---33908, therefore till it holds this range there is no fear of sharp and consistent decline. However it has slipped into very short correction mode yesterday 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 levels and today it did hit a level of 34357.35 which was very close to the last correction completion point of 34322 so it may have completed the correction. But please note that break below 34322 could weaken it further and can drag it down to 33908 levels and break blow this point could accelerate the fall. The long term bias still looks positive for the uptrend to continue as of now. But the short term outlook has turned weak, furthermore one very important technical indicator on the daily and weekly chart is showing weakness and indicates that it could fall and it has been falling for the last two days and if it does not improve fear of further fall will always be there with intermittent relief rallies. So be extremely cautious in the long trade at this point of time.

In view of the above observation, since it is into very 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 34450 and maintain for some time or can try buy on decline at appropriate points or near 34322 but not below it and then near 33908 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 the 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 34450 and maintain for some time with a stop loss of 34350.It is for the aggressive traders and could be a highly risky trade.

Or

Buy on decline at appropriate points or near 34322 but not below it with a stop loss of 34200. It is for the aggressive traders and could be a risky trade.

Or

Buy on decline near 33908 but not below it with a stop loss of 333800. It is for the aggressive traders and could be a risky trade.

2. Sell on the rise near or within the range of 34900---35060 with a stop loss of 35160. It could be a highly risky trade but worth trying for intraday gain.

Or

Sell near if it does not move above 34720 in first one and half hour of trade with a stop loss of 34820. It could be a highly risky trade but worth trying for intraday gain.

Or

Sell if it moves below 34322 and maintain for some time with a stop loss of 34450. 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.