A TECHNICAL UPDATE ON CNX-NIFTY—20.10.2023

 

CNX-NIFTY

Open-19545.20---High—19681.80--Low-19512.35--Close-19624.70 on 19.10.2023.

Support: 19622.40/19615.95/19584.45/19563.10/19544// 19492.10/19482.75/19467.50/19465/19458.55/ 19421/19405/19361.75/19333.60/ 19303.60/19300/19296.45/19253.60/19223.65/18887.60/18646.70/18555.40/18464.55

Resistance: 19638.30/19645.50/19657.50/19766.65/ 19795.60/ 19838/19867.55/19887.40/19901/19986.73/ 19991.85/20168/20184/20201/20222.45.

 (Bold and underlined figures are most important)

It opened with a huge down gap and went down further but latter on staged a sharp recovery back but could not sustain and finally ended the day with a loss of 46.40 points. It is still into short term correction mode for its earlier rise and into short correction mode for its very recent rise as it closed below its threshold point of 19728(figure may change).It is below its short & some medium term moving averages on the daily chart and broken recent bottom on the line & bar chart, all these factor together are concerning and can drag it down further. But the good point is it is still above its meaningful pullback threshold point of 19544(figure may change), it did break this mark intraday today but bounced back above it , therefore as long as it holds this level chances of up move is still alive . But to have a smooth & steady up movement it has to close above 19750(figure may change) and sustain on the closing basis. Please note that to get into the strong up momentum track it has to close above 19991.85 & 20045(this figure may change) and sustain on the closing basis. The short term technical setup has weakened a bit and on the daily chart four out five important indicators are negative now posing great concern and indicates further fall may be ahead, furthermore few indicators on the weekly chart are also negative as of now, which is a weak indication. 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, the price action was terribly weak today also, 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. Its long term uptrend is intact as of now but short term correction is on now and further down side is possible.

Moving up from here it may face resistance at 19635.30---19638.30---19750---19838---19883---19986.73---19991.85---20013----20045---20201---20222.45(figure may change), it may correct at any of these points and then may resume the up move again or rally may exhaust also. So be watchful. Please note that sustained close above 19750 may help it to have smooth up move, sustained close above 19838 can take it to 19991.85 levels and sustained close above 20045 will possibly ensure that it could retest its all-time high of 20222.45 or may go beyond it also.  

Kindly note that moving down from here its strong support points would be 19622.40---19544---19505.37---19480.50---19421(figure may change) sustained break below  19622.40 will be a warning signal and make it weaker, break below 19544 & 19505.37 may end the possibility of continuation of the pullback up move, break below 19480.50 may accelerate the fall, break below 19421 will push it into deep medium term corrective mode and it may slide down further and then the next strong support range would be between 19300—19255---19234---19223.60.

IMPORTANT NOTE: - It had a down move for the last two todays and the price action has also been very weak, so if it does not bounce back above 19750 in a day or two and sustain then it can slip down further.

TRADING TIPS:--

1. Safe traders should avoid long trade till correction completion sign emerges or it closes above 19750 at least. However aggressive traders can try long trade in the range of 19512---19480 with a stop loss of 19440. It could be a risky trade.  

2. It is into the long term uptrend therefore short trade in general could be a risky affair, but it is in correction mode and pullback mode is also on , even then short trade can be attempted but with extreme caution and care on the reasonable rise or on the price breakdown for intraday corrective gains. Short trade can be tried on the rise near or within the range of 19710---19740 with a stop loss of 19780 or sell below 19580 with a stop loss of 19650.

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. 

 for strategic guidance to enter and exit trade.

Thanks 

Narendra Kumar Surana

Mobile—8240951127/9831313654.

 Email--- suranank@gmail.com