A TECHNICAL UPDATE ON CNX-BANK NIFTY—18.1.2024

 

 

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 CNX-BANK NIFTY

Open—46573.95--High—47212.75--Low—45979.60---Close—46064.45 on 17.1.2024.

Support:45655.50/45622/45281/45239/45118.05/44949.90/44710.55/.44547.80/44279.40/44151.80/43830.75/43796.75/43600.35/43345.95/43230.95/42582.20/42105.40.

Resistance: 46310.10/46369.50/46507.15/46886.90/46919.70/47010.80/47411.65/47481.35/47588/48166.15/48203.45/48219.95/48292.25/48381.95 48636.45/48722/48925/49024/49567.60/49696/49857/50324/50633.60/50850.

(Bold and underlined figures are most important)

It opened with a huge down gap and went down further and finally ended the day with a whopping loss of 2060.65 points. As apprehended finally volatility has taken a toll and it declined sharply today. Please note that the gap it created today is still there and if it makes an effort to fill the gap in next 4-5 trading session, which is technically possible then it can come up to 48002.85 But if it fails to fill the gap in the stipulated time then the chances of filling the gap will recede for the time being. It is important to mention here that the gap filling threat on the weekly chart has faded out for now but please note that eventually it will fill the gap someday, which please note.

 It is important to mention here that its critical & important points are 48203.45---48292.25 & 48636.45and to keep up the up momentum going in the year 2024 it has to sustain above these points on the closing basis else it may head down.  It is way below all the three critical points, it has decisively breached all the correction threshold points and most critical points of 48231.30---48133.94---47999.87---47360.75---47095.12 & 46369.50(figures may change), which is a hugely negative sign and indicates further fall ahead please note that if it fails to move above 46369.50 and sustain on the closing basis then the correction will deepen further and may last longer. It has slipped into long term correction mode now for its recent months rise, but the long term trend is still up as of now. It is important to mention here that its short and long pullback threshold points are at 46528.49 & 46606.62(figure may change) and if it moves above these points and sustain on the closing basis then it could give a meaningful up move and hope of the continuation of the up move will be alive, else correction may continue with very short relief rallies. 

It is very important to mention here that all the five important technical indicators are  negative now on the daily chart and indicates that it could drag it down to much lower levels in the coming days,  one of the most important indicator on the weekly & monthly chart is also negative and it is already into the corrective mode, it is still making  lower top & bottom on the line and bar chart, furthermore the chart setup has got a severe jolt today as it has broken all its recent key bottoms, fallen below all its short term and few medium term moving averages and devastatingly weak price action, all together situation is highly concerning and further fall looks inevitable, therefore please note that if it fails to stage a sharp recovery in a shortest possible time and moves above some of the key points as mentioned above and sustains then the fall is likely to continue. In view of the overall observation it is suggested to adopt sell on the rise strategy or sell on the price breakdown till visible sign of correction completion emerges. However long trade can also be tried at the most critical support points with strict short stop losses for pullback gains, but it could be a risky affair mind you. 

Moving down from here its important support points could be at 45655.50---45484---44949.50---44710.55---44547.80---44279.40---43830.25---43796.75---43600.35(figures may change), please note that it can bounce back from any of these points and may resume the up move again, else may keep moving down. 

Similarly moving up it may face strong resistance at 46369.50----46507.15----46528.50---46606.62---46886.90---46919.70---47010.80----47095.12---47360.75---47481.35---47588---47999.87----48105.08---48133.94---48203.45---48219.95---48231.30----48252.80---48292.25---48311.32----48381.95----48636.45(figure may change) and it can correct at any of these points and then may resume the up move again or it may exhaust the up move at any of these points also and may head down. But please note that if it moves above 48105.08 and sustain on the closing basis then it could retest its all-time high of 48636.45 or may go beyond it also.

IMPORTANT NOTE: --AS ENVISAGED AND AMID HIGH VOLATILITY AS APPREHENDED IT WITNESSED A SHARP FALL TODAY AND FURTHER FALL LOOKS QUITE IMMINENT WITH IN BETWEEN SHORT RELIEF RALLIES TILL IT MOVES ABOVE ITS PULLBACK THRESHOLD POINTS AS MENTIONED ABOVE AND SUSTAINS.

TRADING TIPS:--

1. Safe traders can try long trade only if it closes above its pullback threshold point of 46528.49 or 46606.62 and sustain, avoid long trade on decline for the time being. But aggressive traders can try long trade on sharp decline near 44850 with a stop loss of 44750. Please note that long trade in corrective mode could be a risky affair but can be tried at extreme critical support points with strict stop loss for pullback gains.

2. It is in the long term uptrend therefore short trade in general could be a highly risky affair, but it has slipped into deep corrective mode, therefore short trade can also be attempted on reasonable rise or on price breakdown for intraday corrective gains but with extreme caution and alert. Short trade can be tried on the rise near or within the range of 46900---47000 with a stop loss of 47200 or sell below 45970 with a stop loss of 46200. It could be a risky trade but worth trying for intraday corrective gains

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.

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