A TECHNICAL UPDATE ON CNX-BANK NIFTY—5.2.2024

 

 

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 CNX-BANK NIFTY

Open—46568.20--High—46892.35--Low—45901.25---Close—45970.95 on 2.2.2024.

Support: 45655.50/45430.20/45071.20/44710.55/44949.90/44547.80/44429/44279.40/44151.80/43830.75/43796.75/43600.35/43345.95/43230.95/42582.20/42105.40.

Resistance: 46310.10/46369.50/46580.30/46919.70/47010.80/47481.35/47588/48166.15/48203.45/48219.95/48292.25/48305.40/48381.95 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 and went up further but could not sustain at the higher level and slipped down and in the process filled the gap also and finally ended the day near the low of the day with a loss of 217.70 points, today’s move was highly disturbing and indicates inherent weakness. Please note that it is exhibiting huge volatility in fact it is having a see-saw movement quite often and it happened today also 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 well 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----46311----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, but the good thing is that it is well above its long moving average range upper band which is placed at 45581(figure will change every day) ,which is a positive sign. It is important to mention here that its short and long pullback threshold points are at 44937 & 45421.96(figure may change) and it is well above both the pullback threshold points, therefore it can still give a meaningful up move and the hope of continuation of the up move will be alive till it holds these points on the closing basis, else it may head down.

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 may drag it down in the coming days or can have mixed and wild movements on the either side, furthermore three most important indicators on the weekly & one on the monthly chart is also negative and it is into long term corrective mode. The chart setup is still weak, it is still below few of its short term moving averages on the daily and weekly chart, below some medium term moving averages also, all together it still indicates down move may happen. But the ray of hope for the continuation of the up move is that it is well above its long term moving average upper band of 45581(figure will change every day) and pullback threshold point of 45421.96(figure may change) In view of the above observation long trade can be tried on decline till it holds these points on the closing basis. 

Moving down from here its important support points could be at 45951.35---45910-----45759----45661----45505---45421.96----45370---45343.83---45251---45010.35---44949.50---44921----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 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: -- PLEASE NOTE THAT AS LONG AS IT HOLDS 45581(FIGURE WILL CHANGE EVERY DAY) &45421.96 ON THE CLOSING BASIS CHANCES OF UP MOVE WILL BE ALIVE. BUT TODAYS MOVE WAS CONCERNING AND IF IT STAYS BELOW 45901 THEN IT MAY SLIP DOWN FURTHER. 

TRADING TIPS:--

1. For safe traders long trade can be tried on decline if it holds 45900 for some time with a stop loss of 45800 or can buy if it moves above 46217 and maintain for some time with a stop loss of 45900. But aggressive traders can also try long trade on sharp decline near or within the range of 45581—45450 with a stop loss of 45300.  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 term uptrend but in the long deep corrective mode but pullback up move is also on, 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 46700-46800 with a stop loss of 46900 or sell below 45900 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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