A TECHNICAL UPDATE ON CNX-BANK NIFTY—5.12.2023

 

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                                                                CNX-BANK NIFTY

Open---45671.50---High—46484.45---Low---45484.20---Close—46431.40 on 4.12.2023.

Support: 46369.50/46310.40/45905.85/45893.80/45816/45782.75/45655.50/45238.80/45118.05/44949.90/44779.65/44710.55/.43600.35/44547.80/44498.60/44279.40/44151.80/43830.75/43796.75/43345.95/43230.95/43078.90/43038.25/ 42986.45.

Resistance:46484.45/46850/47123/47420/47454/47575/47808/47917/48081/48925/50850.

 (Bold and underlined figures are most important)

It opened up with a huge up gap and it hit a new all-time high of 46484.45 and finally ended the day with a colossal gain of 1617.20 points. It is important to mention here the gap it created today is still there and if it makes an effort to fill the gap in next 3-4 trading sessions, which is technically possible then it can come down to 44951,but if it does not fill the gap in stipulated time then chances of filling the gap will recede.

It has exhibited extra ordinary strength today and it has surpassed and closed above its previous all-time high of 46369.50,it is in the new territory now therefore it is likely to extend the up move further but due caution is suggested, because in new territory possibility of correction is very high and since it had vertical rise therefore correction could be vertical also at times  and it can happen any movement, so ride the on-going up move cautiously and keep a watch on the price action for correction indication. I once again repeat that the on-going up move is likely to continue with intermittent correction, but break below 46369.50 could be an alert point, break below 45716.61 & 45451(figure may change) will push it into short & deep short correction mode for its recent rise, which please note. It is in the long term uptrend and bias is bullish as of now and it is buying on decline market till it indicates otherwise.

It is important to mention here that all the five important technical indicators on the daily chart are positive now, therefore the on-going up move can extend further provided it holds the key points mentioned above, furthermore despite the robust rise still four out of five indicators on the weekly chart and two out of five indicators on the monthly chart are negative, which is slightly concerning and indicates that after the on-going up move exhaustion it may still witness deep fall in coming weeks/months. But please note that as long as price action remains positive there is no major threat and up move can extend with intermittent correction and weekly and monthly indicators may turn positive also in coming days. So watch out. 

Moving up from here it may face resistance at 46484.45----46850---47123---47420---47454---47575---47808 (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.

Kindly note that moving down from here it’s possible support points would be at 46369.50----46310.40---45716.61---45517---45451----44951---44764—44580---44481(figure may change) it may bounce back from any of these points, but break below each support point could weaken it and can drag it down further, which please note.

TRADING TIPS:--

1. Long trade can be tried on decline if it holds the range of 46369—46310 with a stop loss of 46160 or if it move above 46485 and maintains above it for some time with a stop loss of 46300. But aggressive traders can also try long trade on the sharp decline near or within the range of 45700----45500 with a stop loss of 45380.

2. It is in the long term uptrend therefore short trade in general could be a highly risky affair, but even then short trade can be attempted on reasonable rise for intraday corrective gains but with extreme caution and alert. Short trade can be tried on the rise near or within the range of 47200---47300 with a stop loss of 47450.

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 favourable 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.