A TECHNICAL UPDATE ON CNX-BANK NIFTY—30.10.2023

 

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CNX-BANK NIFTY

Open---42555.60---High—42840.15---Low---42482.75---Close—42782 on 27.10.2023.

Support: 42720/42582.20/42108/42105.40/41962/41829.60/41626/41569/41060/40819/39424.85/39300.

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 positive note and steadily moved up and finally ended the day with a gain of 501.85 points. It was in oversold territory and had six days of strait fall, therefore as expected it staged a recovery today, it was a relief rally only and may not last because the overall technical setup is exhibiting tremendous weakness on the daily and weekly chart and the weakness has trickled down to monthly chart also, therefore eventually it is likely to move down in coming days. It is into deep short & medium term correction mode for its earlier rise and into short correction mode also for its very recent rise and most importantly long term uptrend is severely threatened, therefore further fall looks certain as of now. The good point today was that it closed above its short pullback threshold point of 42720(figure can change) and if it sustains above it then it can have feeble extension of the up move. It is important to mention here that if it closes above 42986.45 & 43038.25 and sustain then it can some hope that it can still move up, if it close above 43112(figure can change) and sustains, which is a meaningful pullback threshold point then the up move can extend further, but to get a strong foothold for the continuation of the up move it has to close above 43345.95 and sustain, else down move will continue with in between relief rally. Please note that all the five important technical 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 have 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 but today it had positive price action, which is a good 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 and see how it behaves in coming days. so watch out. It is into deep short & medium term correction mode now and long term uptrend is potentially threatened. So the further downside looks inevitable.

Kindly note that moving down from here its possible support points would be at 42720---42666.75----42559.50---42473---42386---42279---42252---42100---41984---41907---41829.60---41576---40948----40444---40164---39300(figure may change) it may bounce back from any of these points, but break below 42666.75 may possibly end the relief rally which happened today, break below 42280 will trigger fall again, break below 42100 may accelerate the fall and finally sustained break below 41829.60 may trigger fresh fall and can drag it down much lower.

Moving up from here it may face resistance at 42986.45---43038.25---43112---43345.95---43734---44096---44151.80---44237---44741---45118---45318---45363---45517---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: -- Please note that as of now weekly indicators are pointing towards big fall in coming weeks and it could head down to 41000 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 43112 at least. However aggressive traders can try long trade if it moves above 42850 and maintain for some time with a stop loss of 42650 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 43100---43200 with a stop loss of 43360 or sell below 42650 with a stop loss of 42850.

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. 

Thanks 

Narendra Kumar Surana

Email—suranank@gmail.com

Mobile—8240951127/9831313654.