A TECHNICAL UPDATE ON CNX-NIFTY—11.1.2024

 

CNX-NIFTY

Open-21529.30--High—21641.85—Low—21448.65--Close-21618.70 on 10.1.2024.

Support: 21593/21500.35/21492/21337.75/21037.90/20976.80/20769.50/20291.55/20222.45/19991.85/19875.25/19839/19635.30/19333.60/19329.10/19223.65/18973.30/18887.60/18837.85.

Resistance: 21680/21727.75/21731.40/21763.95/21801.45/21834.35.

 (Bold and underlined figures are most important)

It opened on a negative note today and had both side movement during the day and finally ended the day with a gain of 73.85 points. It is exhibiting huge volatility and this is not a good sign for a steady market. 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 21477.15 &20291) and there is a fair chance that it may try to fill this gap in the week starting from 8.1.2024 else chance of filling the gap may recede for a while but eventually it will fill the gap, which please note, so be alert, cautious and watchful.

It is important to mention here that its critical points are 21801.45---21731.40 & 21727.75 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 head down. It is way below all the three critical points; furthermore it is still into very short correction mode as it is below its threshold points of 21631.97. Please note that break below 21583.05---21346.82 & 21127.18(figure may change) will push it into deep short, medium and long term correction mode for its recent rise and break below 20222.45 could be an extreme alert point and then correction may further deepen and can last longer. It is in correction now but the long term trend is still up as of now. The good point is that it closed above its short & long pullback threshold point of  21539.70 & 21523 (figure may change) today and if it holds above these points on the closing basis then it can have meaningful up move, else correction may continue with very short relief rallies. 

It is very important to mention here that three out of five important technical indicators are negative now on the daily chart and indicates that it could drag it down to 21150 or lower in coming days, it is into correction mode also, furthermore short term chart setup has weakened as it making lower top & bottom on the line and bar chart, it is below some of its short term moving averages and price action is also inconsistent and weak most of the time recently, therefore all together it is highly concerning. Please note that if it fails to stage a sharp recovery in a shortest possible time and moves above important points as mentioned above and sustains then the correction will deepen. In view of the overall observation it is suggested to adopt sell on the rise strategy or sell on the price breakdown till it gives visible sign of correction completion or continuation of the up move. However long trade can also be tried at the most critical support points with strict stop losses for intraday gains. 

Moving down from here its important support points could be at 21596---21583.05------21539.70----21523----21500.35----21448.65---21406---21337.75---21304---21179---21148---20976.80----20769.50(figures may change), please note that it can bounce back from any of these points and may resume the up move again but break sustained break below 21500.35 & 21448.65 may trigger fresh fall and sustained break below 20976.80 & 20769.50 may accelerate the fall. 

Similarly moving up it may face strong resistance at 21631.97----21641.55---21687----21702---21727.75---21731.40---21743---21757.29---21801.45---21834.35---21906--21974(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 21757.29 and sustain on the closing basis then it could retest its all-time high of 21834.35 or may go beyond it also.

IMPORTANT NOTE: -- IT IS STILL BELOW THE CRITICAL POINTS OF 21727.75---21731.40 &21801.45, FURTHERMORE IMPORTANT TECHNICAL INDICATORS ARE ALSO NEGATIVE, THEREFORE DANGER OF GOING DOWN IS STILL THERE TILL IT MOVES ABOVE THE CRITICAL POINTS AND SUSTAIN OR TECHNICAL INDICATORS IMPROVES, FURTHER FALL  LOOKS QUITE IMMINENT IN THE COMING DAYS AS OF NOW.

TRADING TIPS:--

1. For safe traders long trade can be tried if it closes above 21732 and sustains or can be tried on decline if it holds the range of 21539.70 & 21523 with a stop loss of 21480. But aggressive traders can also try long trade on sharp decline near or within the range of 21180---21150 with a stop loss of 21100 or near 20980 with a stop loss of 20940. Please note that long trade in corrective mode could be a risky affair but can be tried at critical support points with strict stop loss.

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 correction mode for its recent rise, 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 21720—21740 with a stop loss of 21780.

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