A TECHNICAL UPDATE ON CNX-BANK NIFTY —20.3.2023

 

CNX-BANK NIFTY

Open-39442.40-High-39705.15-Low-38926.80-Close-39598.10 on 17.3.2023.

Support:-39419.80/39335/39258.25/39197.20/38765.85/38613.15/38437.95/38426.65/37950---943/37581.05/37386.35.

Resistance:39600.25/39868.85/ 40269/40288.90/40819.15/41095.10/41569.45/41643.90/41671.20/41677.65/41729/41791.95/41829.60/41840.15/41877/41979.10/42078.90/42202.55/42555.15/42622.75/42716.80/42740/42880/42948/42986.45/43038.25/43081/43339.15/43498.05/43515.05/43578.40/43614.65/43853.40/44151.80.          

 (Bold and underlined figures are most important)      

It was majorly on the down-slide during the week but in last two days it moved up, however it ended the week on 17.3.2023 with a loss of 887.34 points, which is a weak sign.

The technical setup and price action is weak but as expected it gave a smart up move today,  it is already into deep corrective mode, it is below its short & medium term moving average on the daily & weekly chart and some are below on the monthly chart also, almost all important technical indicators are negative on the daily chart except for one key indicator which is still positive so today’s up move can extend for a day or two, but most importantly the technical indicators are already negative as of now on the weekly & monthly chart indicating that it could break 38600 & 34700 levels or can go below it also in coming weeks/months, which is highly concerning. But please note that as long as it holds it critical support range of 38983---38739 (broke this range intraday once)---38613 there is a hope that it could bounce back from this range, it did bounce back today from this range and the good thing is that it moved within its long term moving average range today which is placed between 41277---39346(figures will change every day) for the day, so now the key support points are 39346---39335---38983—38739---38613 but looking at the weekly & monthly technical indicators holding this range seems less likely. Therefore sustained break below 38739 can drag it down to 37386.35 and sustained break below it on the closing basis may end the long term uptrend for a reasonable length of time and fall may accelerate, so be watchful.

Moving up it will find resistance at 39781—39921---39971---40142---40503---40690---40770 (these points could be possible sell point also).   Please note that 39335 & 39921(the figures will be scaled down if it breaks 38613.15) are the short and major pullback trigger points and today it closed above its short pullback trigger point of 39335, so if it sustains above this point then the up move may extend, but strong, meaningful and lasting pullback up move can only be expected if it moves above 39921 and sustain on the closing basis. It will gain potential strength for strong up momentum once it moves above its long term moving average range and sustain on the closing basis.

In view of the above observation the deep  down correction is on therefore it is a sell on the rise market or sell on the price breakdown in general and for the safe traders it is suggested to avoid long trade till a visible sign of correction completion emerges. However aggressive traders can try long trade at important and critical support points for the pullback gains. But be alert and extremely cautious in the long trade initiated for pullback gains because it is in deep corrective mode and you are well aware that pullback rallies are treacherous in nature and can end abruptly trapping the traders unaware. The bias is hugely bearish as of now.

TRADING VIEW: - Long trade can be tried if it hold 39345---39335 with a stop loss of 39000 for pullback gains. It is in deep corrective mode therefore long trade could be risky bet. Short trade should be attempted on the rise at appropriate points (see resistance points) or on price breakdown.

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.

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. 

m for strategic guidance to enter and exit trade.

Thanks 

Narendra Kumar Surana

Email—suranank@gmail.com

Mobile—8240951127/9831313654.