A TECHNICAL UPDATE ON CNX-NIFTY—6.11.2023

 

CNX-NIFTY

Open-19241---High—19276.25--Low-19210.90--Close-19230.60 on 3.11.2023.

Support: 19223.65/19204.85/19172.79/19165/19077/18973.30/18887.60/18837.85/18646.70/18604.45/18555.40/18464.55/18350.95/18131.70/18114.65/18105.30/18042/17992.20/17959/17824/17774.25.

Resistance: 19296.45/19300/19303.60/19333.60/19361.75/19405/ 19421/19458.55/ 19465/19467.50/19480.50/19482.75/19492.10/19512.35/19544/ 19563.10/19584.45/19615.95/19622.40/19638.30/19645.50/19657.50/19766.65/ 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 an up gap and moved up further and thereafter moved in a short range during the day and finally ended the day with a gain of 97.35 points. It moved in a very short range today, therefore it seems that it is bracing for a big move on either side on 6.11.2023, furthermore the price action was positive today, therefore likely to move up but since it closed near the low of the day, which is causing some concern and can drag it down if it sustains below 19210.90, similarly sustained break above 19276.25 can extend the up move. The short term technical setup has improved a bit but overall it is still exhibiting weakness on the daily and weekly chart despite last two days rise. It is already into deep short & medium term correction mode for its earlier rise and break below 19204.85 & 19172.79(figure may change) will push it into short & deep short correction mode for its very recent rise. But the good point now is that it is well above its critical point of 18887.60, it is making higher top & bottom on the line & bar chart and most importantly it has closed above its critical range of 19223.60---19204.85—19172.79---19165---19100(figures may change) today and if it holds this range on the closing basis then the up move is definitely going to extend, else it may start to move down again. Please note that to have a smooth & steady up movement it has to move above 19430---19530& 19650 (figure may change) and sustain on the closing basis and to get into the strong up momentum track it has to close above 19850—19946&19991.85(figure may change) and sustain on the closing basis. Please note that one out of five important technical indicators  on the daily chart has turned positive today raising some hope that up move can extend, but all the five indicators on the weekly chart are negative and most importantly weakness has trickled down to monthly chart also in few indicators , therefore all together it is still highly concerning and indicates that after possible extended up move it may witness deep fall in coming days/ weeks/months. Furthermore the price action has also not been consistently positive, which is also a big concern, but it has been positive for the last two days. Please note that for a smooth up movement steady positive price action is needed, else the up move can abruptly end. It is therefore suggested to keep an eye on the price action and see how it behaves in coming days. Its long term uptrend is intact as of now, but deep short and medium term correction mode is on and if falls below the mentioned range and sustains then further fall looks inevitable.

Kindly note that moving down from here its strong support points would be 19223.60---19204.85—19172.79---19165---19100---19034----18973.70---18887.60---18837.85---18604.45---18563---18350.95---18131.70----18105.30(figure may change) it may bounce back from any of these points, break below 19223.60 will be an extreme alert point, but sustained break below the range of 19223.60---19100 will trigger fresh fall,  sustained break below 18973.70 will weaken it further, sustained break below 18887.60 & 18837.85 will be an extreme alert point for further fall, sustained break below 18563 will potentially threaten the long term uptrend and finally sustained break below 18131.70 & 18105.30  may accelerate the fall, which may please be noted.

Moving up from here it may face resistance at 19344---19367---19421---19463---19480.50---19530---19611---19647---19694---19850---19896---19946(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.

IMPORTANT NOTE: - In light of above observation it may have an extended up move if it holds the range of 19223.60---19100, specially the  19223.60 levels in particular, therefore long trade can be tried on decline till it holds this range, so it is buying on decline as of now till it behaves otherwise. Please note that if it sustains below 19210 it could be a weak indication for the day. But please note that weekly indicators are still pointing towards big fall in coming weeks and it could head down to 18000 or much lower levels in coming weeks provided it moves below 18887.60 & 18837.85 and sustains.  

TRADING TIPS:--

1. For safe traders long trade can be tried if it moves above 19245 and maintain for some time with a stop loss of 19200 or if it holds 19223.60 for some time with a stop loss of 19160 please avoid buy below 19223.60. However, aggressive traders can also try long trade on sharp decline near or within the range of 19100---- 19065 with a stop loss of 18965. It could be a risky trade mind you.

2. Its long term uptrend is intact but it is already into deep short and medium term correction mode but meaningful pullback up move is also on, even then short trade can be attempted on reasonable rise for pullback gains but with extreme caution and alert. Short trade can be tried on the rise near or within the range of 19340—19360 with a stop loss of 19400 or sell if it does not move above 19276 in first hour of trade even in intraday with a stop loss of 19320. It could be a risky trade

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

Mobile—8240951127/9831313654.

 Email--- suranank@gmail.com