A TECHNICAL UPDATE ON CNX-NIFTY—17.1.2024

 

CNX-NIFTY

Open-22090.50--High—22124.15—Low—21969.80--Close-22032.30 on 16.1.2024.

Support: 22027/21982/ 21974/21931/21928.25/21906/21834.35/21801.45/21763.95/21731.40/21727.75/21680/21593/21500.35/21492/21337.75/21037.90/20976.80/20769.50/20291.55/20222.45/19991.85/19875.25/19839/19635.30/19333.60/19329.10/19223.65/18973.30/18887.60/18837.85.

Resistance: 22073/22124/22220/22459/22478/22590/23082/23124/23587.

 (Bold and underlined figures are most important)

It opened on a negative note and had both side moves during the day and hit a new all-time high of 22124.15 but finally ended the day with a loss of 65.85 points. Please note that the gap it created on 15.1.2024 is still there and if it makes an effort to fill the gap in next 3-4 trading session, which is technically possible then it can come down to 21928.25. 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. Furthermore it is exhibiting good strength but huge volatility also and this is not a good sign for a steady market. 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 some day, which please note.

The technical setup is strong and it is well above its most critical & important points of 21727.75---21731.40 & 21801.45 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 head down, sustained break below 21801.45 could be a warning and alert sign and sustained break below 21727.75 could be an exit sign from the long trade, which please note. Furthermore please note that break below each of these points 21964.73---21853.38---21804.45---21568.23 & 21348.58 (figure may change) will push it into deep 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 in the long term uptrend now. 

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 to lower levels in coming days, despite it hitting a new high today, however on the other parameters such as technical setup, moving average placements and price action it is showing good strength, therefore till these parameters remains o.k. it is likely to continue the up move with intermittent correction.  In view of the overall observation now it is suggested to adopt buying on decline strategy till it holds its critical & important points as mentioned above on the closing basis. 

Moving up from here it may face strong resistance at 22073---22124---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. 

Similarly moving down from here its important support points could be at 22027---21964.73---21866.11---21801.45---21786.40---21757.29---21731.40---21727.75---21703.31---21608---21583.75---21539.70----21448.65--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 the range of 21801.45---21703.31 could be an alert and warning sign and break below   21448.65 may trigger fresh fall and sustained break below 20976.80 & 20769.50 may accelerate the fall. 

IMPORTANT NOTE: -- AS ENVISAGED IT TOOK A BREATHER TODAY AND IT HAS TO BE SEEN IN NEXT 1--2 DAYS TIME WHETHER IT WILL GET INTO CORRECTION MODE OR RESUME THE UP MOVE AGAIN- SO WATCH OUT.

TRADING TIPS:--

1. Long trade can be tried if it moves above 22098 and maintain for some time with a stop loss of 22020 or on decline near 21930 with a stop loss of 21870. But aggressive traders can also try long trade on sharp decline near or within the range of 21801---21750 with a stop loss of 21700.

2. It is in the long term uptrend therefore short trade in general could be a highly risky affair, but even then short trade can 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 22180—22200 with a stop loss of 22250.

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