A TECHNICAL UPDATE ON CNX-NIFTY—1.2.2024

 

CNX-NIFTY

Open-21487.25--High—21741.35—Low—21448.85--Close-21725.70 on 31.1.2024.

Support: 21680/21593/21500.35/21492/ 21448.65/21337.75/21285.55/ 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: 21727.75/21731.40/21763.95/21801.45/21834.35/21906/21931/21974/21982/ 22027/22073/22124/22220/22459/22478/22590/23082/23124/23587.

 (Bold and underlined figures are most important)

it opened with a down gap and went down little further but filled the gap during the day and finally ended the day with a gain of 203.60 points. Please note that it is exhibiting huge volatility in fact having a see-saw movement quite often which is not good for a steady and smooth movement and may eventually drag it down lower. It is important to mention here that the gap filling threat for earlier gap on the daily & weekly chart has faded out but please note that eventually it will fill the gap someday, which please note.

Its most critical & important points are 21801.45---21731.40 & 21727.75 and to keep 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 still below all its critical points. Furthermore it is still into very short, short and deep short term correction mode as it is below its threshold point of 21964.73---21853.38---& 21804.45 (figure may change) please note that break below 21653.55---21568.23---21348.58 & 20874.34(figure may change) will push it into medium, long and deep long term correction mode and sustained break below 20222.45 could be an extreme alert point and then correction may further deepen and can last longer. It is into deep short term correction mode now but the long term uptrend is still intact as of now. It is important to mention here that its short & long pullback threshold points are at 21282 & 21370.12(figure may change) and it is still well above it , therefore as long as it holds these points on the closing basis it may have a meaningful pullback 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 three out of five important technical indicators are negative now on the daily chart and indicates that it could drag it down to much lower levels or may have mixed movements, in coming days, furthermore one most important indicator on the weekly & monthly chart is also negative and it is into deep short term corrective mode. The volatility is disturbing the chart setup quite often which is a bad sign and the see-saw movement it is witnessing could drag it down eventually. It bounced back again above its short and medium term moving averages on the daily chart today but the price action was weak today. Please note that overall it is not painting a sound picture for the steady continuation of the up move as of now. However the hope of up move will be alive as long as it hold range of 21370.12---21282 on the closing basis.  

Moving up from here it may face strong resistance at 21727.75----21731.40----21747.16----21801.45---21834.45---21891.23---21926.76---22124.15---22220----22459---22478(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 21926.76 and sustain on the closing basis then it could retest its all-time high of 22124.15 or may go beyond it also. 

Similarly moving down from here its important support points could be at 21630---21593---21555---21516---21475----21448---21370.12---21282---21248---21206---21137.20----21089---21040----20976.80----20946.35---20868.78---20769.50---20668----20324----20240(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 20976.80 & 20769.50 may accelerate the fall. 

IMPORTANT NOTE: -- IT IS BELOW ALL ITS CRITICAL POINTS OF 21801.45--- 21731.40 & 21727.75 BUT WELL ABOVE THE PULLBACK THRESHOLD POINTS OF 21282 & 21370.12. PLEASE NOTE THAT IF IT REMAINS ABOVE THE PULLBACK THRESHOLD POINTS CHANCE OF AN UP MOVE WILL BE ALIVE. BUT IT WILL PICK UP STRONG UP MOMENTUM ONLY IF IT SUSTAINS ABOVE ITS CRITICAL POINTS ON THE CLOSING BASIS.

TRADING TIPS:--

1. Long trade can be tried on decline near 21520 with a stop loss of 21470 or if it maintains above 21742 for some time with a stop loss of 21680.  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 is into deep short term 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 21960--- 22010 with a stop loss of 22060 or sell below 21500 with a stop loss of 21570. 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

Mobile—8240951127/9831313654.

Email--- suranank@gmail.com