A TECHNICAL UPDATE ON CNX-BANK NIFTY—30.1.2024

 

 

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 CNX-BANK NIFTY

Open—45171.50--High—45660.35--Low—45110.90---Close—45442.35 on 29.1.2024.

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

Resistance: .45622/45655.50/46310.10/46369.50/46507.15/46886.90/46919.70/47010.80/47411.65/47481.35/47588/48166.15/48203.45/48219.95/48292.25/48381.95 48636.45/48722/48925/49024/49567.60/49696/49857/50324/50633.60/50850.

(Bold and underlined figures are most important)

It opened with an up gap but filled the gap during the day and finally ended the day with a good gain of 576.20 points. Please note that it is exhibiting huge volatility which is not good for a steady and smooth movement and may eventually drag it down lower.

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 is decisively below all  the important correction threshold points for its recent months rise and most critical points  48231.30---48133.94---47999.87---47447.93---47387.89---47360.75---47095.12----46369.50----46270.95(figures may change), which is a hugely negative sign and indicates further fall may be  ahead. Please note that break below 44746.91(figure may change) will push it into deep medium term correction mode for its earlier rise. It is into long term correction mode now for its recent months rise, and most importantly long term uptrend is also threatened as it below its long term moving average upper band of the range which is at 45531(figure will change every day) and this is highly concerning and if it breaks the lower band of the range which is at 44335(figure will change every day) then the long term uptrend will be in potential danger. It is important to mention here that its short and long pullback threshold points are at 45343.83 & 45421.96(figure may change) and today it has closed above it which is a positive sign. Please note that as long as it holds these points on the closing basis it could give a meaningful up move and the hope of continuation of the up move will be alive, else it may head down again.

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, furthermore three most important indicators on the weekly & one monthly chart is also negative and it is into long term corrective mode. The chart setup is still weak despite today’s rise it still has lower top & bottom on the bar chart but crossed recent top on the line chart, fallen below all its short term moving averages on the daily and weekly chart, below some medium term moving averages and most importantly below some long term moving averages also but price action was good today and it is above its pullback thresholds point, therefore there is some ray of hope of moving up. In view of the above 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 45421.96---45343.83---45251---44949.50---44746.91---44607----44506---44404----44312---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 45505---45759---45910----46072----46150----46367---46533----46825---47029----47391---47530----47644----47795---48203.45---48219.95---48231.30----48252.80---48292.25---48305.40---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. 

IMPORTANT NOTE: -- IF IT HOLDS 45421.96 & 45343.83 (figure may change) ON THE CLOSING BASIS AND MOVES ABOVE 45531(FIGURE WILL CHANGE EVERY DAY) AND SUSTAINS ON THE CLOSING BASIS THEN IT MAY GIVE A MEANINGFUL PULLBACK UP MOVE, ELSE IT MAY HEAD DOWN AGAIN. 

TRADING TIPS:--

1. Safe traders can try long trade if it holds the range of 45421.96---45343.83 for some time with a stop loss of 45150. But aggressive traders can also try long trade on sharp decline near or within the range of 44400---44340 with a stop loss of 44200 or if it moves above 45545 and maintain for some time with a stop loss of 45300 for a possible pullback gain. 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 into long deep corrective mode and long term uptrend is also threatened, therefore short trade can also be attempted on reasonable rise or on price breakdown for intraday corrective gains but with caution and alert. Short trade can be tried on the rise near or within the range of 45925---46000 with a stop loss of 46100. 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 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.

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