A TECHNICAL VIEW ON CNX--BANK NIFTY FOR—23.8.2021

 

CNX--BANK NIFTY

Open-35146.50---High-35306.50--Low—34926.50---Close-35033.85 on 20.8.2021

Support:34976/34930/34859.90/34663/34632.60/34555/34525.45/34410/34374/34357.35/34322/34287/34115.20/33908.95/33625/33371/33306.80/32842.30/32613.10/32465.45/32415.15/32347/32157.05/32130/31783.60/31661/31649.49/31297.30/31264.05. 

Resistance;35380/35428.15/35491.95/35584.30/35648/35811/35985.25/36248/36317/36455.15/36497/36615/37100/37232/37708.75/39010/39695/.

(Bold and underlined figures are most important) 

It continued the down move for the 4^th consecutive day and closed with a huge loss of 520.64 points. It is already into very short correction mode and it could come out of it if it moves above 35797 and sustain on the closing basis or it may complete the correction on the downside at the following points 34922---34635---34565(last figure can change). Furthermore if it closes above 35255 it could stage some relief rally but it will gain some strength above 35797 only. Please note that break below 34922 will push it into deep short term correction mode and most importantly sustained break below 34565(figure will change every day) may put the uptrend in potential danger which may be kept in mind. Therefore moving down 34922 & 34565 are the benchmark point as of now.  The other support point would be at 34859.90---34632.60---35525---34410---34115---33908. Please note that break below 33908 could accelerate the fall.  It is important to mention here that for a steady and strong up momentum, it has to move above 36248 and sustain on the closing basis then it could possibly retest its all time high of 37708.75 or may go beyond also. Going up to the level of 37708.75 it will face resistance at 35648---35797---35811---36248---36317---36497---36615---37232---37417 points. Looking at last few day price movement and particularly last two days move, it seems less likely to cross the critical mark of 36248 as of now. Last but not the least it is relatively very weak on the technical chart in comparison with Nifty-50. Therefore be alert and cautious in long trade at this point of time.

It is important to mention here that its long term technical setup is good for the uptrend to continue till it holds 34565(figure will change every day). The short term technical setup has turned weak, so watch out for next 1-2 days whether it improves or not, furthermore one very important technical indicator has turned weak again on the daily chart and on the weekly chart it continues to be negative this weekend also which is concerning and it may drag it down from here. The short term bias is mixed with downward tilt.

In view of the above observation, since it has slipped into very short term correction mode therefore long trade should be avoided till it gives visible indication of correction completion.  However aggressive traders can try long trade if it moves above 35255 and maintain for some time or on decline at appropriate points or near 34922 and then near 34565 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 technical setup gives weak indication in short term, 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 35255 and maintain for some time with a stop loss of 35150.It is for the aggressive traders and could be a highly risky trade.

Or

Buy on decline at appropriate points or near 34922 and then near 34565 but not below it with a stop loss of 34800 & 34450. It is for the aggressive traders and could be a highly risky trade but worth trying.

2. Sell if it moves below 34922 and maintain for some time with a stop loss of 35050. It could be a risky trade but worth trying.

Or

Sell on the rise near or within the range of 35475---35560 with a stop loss of 35650 It could be a highly 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.