A TECHNICAL UPDATE ON CNX-NIFTY—16.2.2024

 

CNX-NIFTY

Open-21906.55--High—21953.85—Low—21794.80--Close-21910.75 on 15.2.2024.

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 a positive note and had both side moves during the day and finally ended the day with a gain of 70.70 points. It has been exhibiting volatility for a long time in fact it is giving see-saw movement quite often, 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. it is well above all its critical points mentioned above 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 21674(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 is way 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 and as of now it is inching towards it, similarly sustained break below 21448.65 may negate this pattern which please note.

The chart setup has improved and it is out of all sorts of correction, therefore now it is likely to continue the up move and moving up from here its upside resistance or target point could be at 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. Similarly moving down from here its important support points could be at 21893.25---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 but break below 21893.25 will push it back into short correction mode again and thereafter break below each point make it weaker. 

It is important to mention here that three out of five important technical indicators are negative and two indicators are positive on the daily chart giving mixed signals that it may swing either way as of now in the coming days. Furthermore one most important indicator on the weekly & monthly chart is negative, but moving averages are well placed and price action has also improved today. Therefore if it remains above its key points as mentioned above then the up move will continue and last but not the least in worst case 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: -- IF IT MOVES AND SUSTAIN ABOVE 21926.76 ON THE CLOSING BASIS THEN IT MAY RETEST ITS ALL-TIME HIGH OF 22126.80 OR MAY GO BEYOND IT ALSO.

TRADING TIPS:--

1. Long trade can be tried on decline near or within the range of 21835---21801 with a stop loss of 21715 or if it moves above 21955 and maintain for some time with a stop loss of 21870.  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, however, 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 22040--- 22070 with a stop loss of 22140.  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