A TECHNICAL UPDATE ON CNX-BANK NIFTY—26.10.2023

 

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CNX-BANK NIFTY

Open---43308.30---High—43397.45---Low---42758.40---Close—42832 on 25.10.2023.

Support: 42582.20/42108/41962/41829/41626/41569/41060/40819.

Resistance:42986.45/43038.25/43078.90/ 43345.95/43446/43519.55/43600.35/43706.15/43830.75/43862/43950/44151.80/ 44182.50/44207.25/44254/44279.40/44390/44459.25/44498.60/44547.80/44539/44566.30/44795/44949.60/45118.05/45238.80/45655.50 45782.75/45816/45893.80/46310.40/46369.50/.        

 (Bold and underlined figures are most important)

It opened on a flat to positive note and moved up little further but could not sustain and started moving down and finally ended the day with a loss of 319.20 points. It has been moving down for the last five days so a short relief rally can happen any day, but the overall setup is exhibiting tremendous weakness, therefore eventually it is likely to move down.  Today it closed below its last critical range of 43038.25---42986.45 & 42953 and if it does not bounce back above this range and most importantly above its most critical and trend changing point of 43345 in a shortest possible time and sustains on the closing basis then it could be heading for a deep down move in coming days, which please note. It is already into deep short & medium term correction mode for earlier rise and also into short correction mode for its very recent rice. It is below all its short term moving averages on the daily and weekly chart, below medium term moving averages on the daily and some on the weekly chart also and most importantly below all its long term moving averages also on the daily chart, all together these developments are highly concerning and indicates further fall is ahead for sure. Please note that to gain some foothold it has to move above at least 43345 and sustain on the closing basis and then it has to move above  its meaningful pullback threshold point of 43611(figure may change) and sustain on the closing basis then there would be a possibility that the up move can extend. But to gain good strength it has to close above 44151.80 & 44210(figure may change) and sustain, and close above 44550(figure may change) may help it for a steady and smooth up move. But to get into the strong up momentum track it has to close above 44711& 45648(figures may change) and sustain on the closing basis, which seems difficult to happen at this point of time. The long and short term technical setup is weak now on the daily chart, furthermore all the five important indicators are negative now therefore chances of moving down further from here looks bright, four out of five indicators on the weekly chart are also negative as of now, which indicates that it may witness deep fall in coming weeks/months. Please note that weak indicators with weak price action are a deadly combination and it can pull it down and the price action has been weak since 18.9.2023 and it is continuing to be weak, which is a bad sign. Please note that for a steady up movement continuous positive price action is needed, else the down move may continue with in between short relief rally. It is therefore suggested to keep an eye on the price action, so watch out. It is into deep short & medium term correction mode now and long term uptrend is potentially threatened. So be watchful.

Kindly note that moving down from here its possible support points would be at 42491---41984---41576---40948----40444---40164(figure may change) it may bounce back from any of these points, else it may keep moving down.

Moving up from here it may face resistance at 42986.45---43038.25---43345---43796.75---43818---43830.75---44151.80---44240---44305---44375---44539---44670---44700---44711---45094---45118---45311---45581---45671---45702---45782.75---45816---45885---46310.40---46369.50(some figure may change). Please note that it may correct at any of these points and then may resume the up move again or rally may exhaust also.

IMPORTANT NOTE: -- Technically it is on a very weak footing in comparison with CNX-Nifty at this point of time, so it is under performing and may keep on doing so. It has been moving down for the last five days and the price action has also been weak and if it does not bounce back above its key points as mentioned above then the further fall looks inevitable. Please note that as of now weekly indicators are pointing towards big fall in coming weeks and it could head down to 42650 or much lower levels. It is sell on the rise market now, therefore trying long trade for pullback gains could be a risky affair, but can be tried by aggressive traders at critical support points, which please note. It is suggested to avoid long trade in general till it closes above 43345 and sustains.

TRADING TIPS:--

1. Safe traders should avoid long trade till correction completion sign emerges or it closes above 43345 at least. However aggressive traders can try long trade if it holds 42760 for some time with a stop loss of 42670 for a possible relief rally. It could be a highly risky trade mind you.   

 2. It is already into deep short and medium term correction mode and long term uptrend is also severely threatened, therefore sell on the rise or sell on the price breakdown strategy should be adopted now. Short trade can be tried on the rise near or within the range of 43350---43400 with a stop loss of 43475 or sell if does not move above 43345 intraday with a stop loss of 43450 or sell below 42750 with a stop loss of 42900.

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.