A TECHNICAL UPDATE ON CNX-BANK NIFTY—5.1.2024

 

 

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 CNX-BANK NIFTY

Open—47805.40--High—48281.20--Low—47738.15--Close—48195.85 on 4.1.2024.

Support: 48166.15/48081/48021/47998/47918/47856/47808/47575/47454/47420/47231/47123/46919.70/46886.90/46850/46484.45/46369.50/46310.40/45905.85/45893.80/45816/45782.75/45655.50/45238.80/45118.05/44949.90/44779.65/44710.55/.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:48203.45/48220/48292.25/48478/ 48502/48574/48636.45/48722/48925/49024/49567.60/49696/49857/50324/50633.60/50850.

(Bold and underlined figures are most important)

It opened on a positive note and went up further and finally ended the day with a gain of 490.90 points. It is important to mention here that for the earlier gaps, the gap filling threat on the daily chart had faded out but it is still looming on the weekly chart (gap point 44951.10), and there is a fair chance that it may try to fill this gap either next week starting from 1.1.2024 or week after that, so be alert, cautious and watchful.

The overall chart setup is good and after four days of down move it staged a sharp bounce back today. But please note that its critical points are 48636.45---48292.25 & 48203.45 and 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 trigger correction. It is still below all the three critical points, it is already into very short correction mode for its recent rise as it is below its threshold point of 48231.30. Please note that break below 48133.94---47360.75 & 47095.12(figure may change) will push it into deep short, medium and long term correction mode for its recent rise and break below 46369.50 could be an extreme alert point and then correction may further deepen and can last longer It is in the long term uptrend as of now, but it is suggested to defer buy on decline strategy for a while and watch how the on-going correction culminates. although it staged a recovery today but despite that it is still not out of woods therefore for the time being sell on the rise strategy can be adopted till it gives visible sign of continuation of the up move. However as long as it holds 47754(figure may change)  on the closing basis a meaningful pullback move will be on, else correction may continue. 

It is very important to mention here that three out of five important technical indicators are still negative on the daily chart and indicates that it could drag it down 46900 or lower in coming days, furthermore one most important indicator on the weekly & monthly chart is also negative and it is still into short corrective mode, but it has moved above all its short term moving averages and price action was also positive today, so if these parameters remain good it could still continue the up move, but if these parameters turn weak then the technical indicators weakness can play havoc and can drag it down sharply. 

I once again reiterate that till it holds 47754 (figure may change) on the closing basis pullback move may be on, else correction may deepen, moving down its important support points could be at 47575---47481.35---47411.65---47324----47263---46919.70---46886.90---46507.15(figures may change), please note that it can bounce back from any of these points and may resume the up move again but break below 47481.35 may trigger fresh fall and sustained break below 46919.70---46886.90 & 46507.15 may accelerate the fall. 

Similarly moving up it may face strong resistance at 47754---47754---47923---48059---48133.94---48195---48203.45---48219.95---48292.25---48364----48405--48636.45---48717---49024---49568---49696(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. But please note that if it moves above 48405 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: -- IT STAGED A SHARP BOUNCE BACK TODAY BUT STILL IN CORRECTIVE MODE AND ALSO BELOW ITS CRITICAL POINTS OF 48203.45----21727.75---48292.25--- &48636.45, SO DANGER OF GOING DOWN IS STILL THERE TILL IT MOVES ABOVE THE CRITICAL POINTS AND SUSTAIN.

TRADING TIPS:--

1. For safe traders long trade can be tried if it moves above 48293 and maintain for some time with a stop loss of 48120 avoid buy on decline for the day.  But aggressive traders can also try long trade on sharp decline near or within the range of 47900---47800 with a stop loss of 47650. Please note that long trade in corrective mode could be a risky affair but can be tried at critical support points.

2. It is in the long term uptrend therefore short trade in general could be a highly risky affair, but it is into very short and deep short correction mode today, 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 48550---48650 with a stop loss of 48750 or sell if it moves below 47700 with a stop loss of 47950. 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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