A TECHNICAL UPDATE ON CNX-NIFTY—15.2.2024

 

CNX-NIFTY

Open-21578.15--High—21870.85—Low—21530.20--Close-21840.05 on 14.2.2024.

Support: 21834.35/21813.05/21801.45/  21763.95/21750.25/21731.40/21727.75/ 21593/21500.35/ 21448.65/21285.55/ 21137.20/20976.80/20769.50/20291.55/20222.45/19991.85/19875.25/19849.75/19635.30/19333.60/19329.10/19223.65/18973.30/18887.60/18837.85.

Resistance:  21926.76/22053.30/22124.15/22126.80/22220/22393/22459/22514/22590/22618/22782/22864/23082/23111/23124/23587.

 (Bold and underlined figures are most important)

It opened on hugely negative note and had both side moves during the day and finally ended the day with a gain of 96.80 points. It has been exhibiting volatility for a long time in fact it is giving see-saw movement quite often and today’s move was a classic example which is not a good sign for a steady and smooth market and can 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(weekly gap of 20291.55 is yet to be filled), which please note.

Kindly note that to keep the up momentum going on in the year 2024 it has to sustain above its  most critical & important points of 21727.75---21731.40 &21801.45 on the closing basis. Today it bounced back to close above all the critical points which is positive sign and if it sustains above these points it may pick up strong up momentum, but break below these points will trigger fall again and break below the range of 21721---21657(figure will change every day) may accelerate the fall, which may please be noted. It is important to mention here that its short & long pullback threshold points are at 21671 & 21370.12(figure may change) and it above both the points and as long as it holds these points on the closing basis chances of up move will be alive, else it may drift down.

It is most important to mention here that it is in the process of making an inverse Head & Shoulder pattern on the daily chart and its neckline is placed at 22126.80 and if it gives an upside breakout from this point then the maximum upside target could be 23120, similarly sustained break below 21448.65 may negate this pattern which please note.

The chart setup has improved a bit as it crossed it recent top on the line chart, but it is still into short term corrective mode  for its very recent rise as it is way below its threshold point of 21893.25(figure may change) moving down from here its important support points could be at 21834.35---21801.45---21766.23---21748.77----21731.40---- 21727.75------21681.04---21632----21514---21448.65---21370.12—21335.15---21285.55----21137.20(figures may change) it may bounce back from any of these points and may resume the up move again but break below the range of 21801.45---21727.75 may trigger fresh fall, which please note. Similarly moving up from here its upside resistance or target point could be at   21893.25---21926.76----21989----22010.11---22053.30---22124.15----22126.80---22220(figure may change) if it moves above 21926.76  and  sustain on the closing basis then it could retest its all-time high of 22126.80 or may go beyond it also. 

It is important to mention here that four out of five important technical indicators are negative on the daily chart and indicates that it may go down further in the coming days. Furthermore one most important indicator on the weekly & monthly chart is negative, but moving average positioning is well placed and price action has also improved today. It is giving mixed signals now but if it remains above its key points as mentioned above then the up move will continue and last but not least as long as it holds 21370.12(figure may change) on the closing basis chances of up move will always be alive. I once again reiterate that the volatility will eventually take its toll sooner or later and it may moderately or sharply head down in coming days. So be alert and cautious in the long trade at this point of time. 

IMPORTANT NOTE: -- IT IS STILL INTO CORRECTION MODE AND TO GET BACK ON THE SMOOTH UP TRACK IT HAS TO MOVE ABOVE 21727.75 ---21731.40---21801.45---21893.25--21926.76AND SUSTAIN ON THE CLOSING BASIS, ELSE DOWN MOVE WILL CONTINUE. BUT THE HOPE OF CONTINUATION OF THE UP MOVE WILL BE ALIVE TILL IT HOLDS 21370.12 ON THE CLOSING BASIS.

TRADING TIPS:--

1. Long trade can be tried if it holds the range of 21801---21755 with a stop loss of 21660 or if it moves above 21894 and maintain for some time with a stop loss of 21780.  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 correction and pullback mode is also on, 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 22060--- 22120 with a stop loss of 22170.  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