A TECHNICAL UPDATE ON CNX-BANK NIFTY—13.5.2024

 

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CNX-BANK NIFTY

Open—47555.50--High—47868.70--Low—47313.35---Close—47421.10 on 10.5.2024.

Support:  47313.35/47279.80/46919.70/46579.05/46529.05/45828.80.                           

Resistance:47737.20/48161.25/48203.45/48292.25/48636.45/ 49057.80/49173.36/49262/49396.75/49446.69/49676/49732/49883/49974.75.        

It opened on a positive note and thereafter had both side moves during the day and finally ended the day with a loss of 66.80 points. It is already into deep correction mode for its recent rise. It has been relentlessly falling for the last 8 days in a row, which exhibits gross weakness in it, therefore it is likely to head down further from here, but it is highly probable now that it could give a short relief rally any day because of the straight fall before resuming the down move again. However if in the possible relief rally it closes above its few important key points as mentioned below then the up move can extend further, else down move will continue. 

STRENGTH:-

1. It is in the long term uptrend as of now. But break below 46861 will threaten the uptrend.  

2. The short range for it now is between 49974.75---47737.20(it is below the range) and the long range is between 49974.75----46579.05.

3. Moving down the possible good bounce back point could be at 47380---47258---46861---46579.05, sustained break below 46861 will threaten the long term uptrend and finally sustained break below 46579.05 could be a warning sign and can drag it down to devastatingly lower levels in coming days and may make the on-going correction more painful time wise and value wise both, which may please be noted. So 46579.05 is a very strong and may be the last bounce back support points as of now or make or break point or benchmark point.

WEAKNESS:-

1. It is into deep correction mode now for its recent rise.

2. It is below its most critical points of 48203.45---48292.25 &48636.45, please note that it is must to stay above these point to keep up the up momentum going in the year 2024.It will catch up momentum above 48636.45 only.

3. It is below all its short term moving averages on the daily chart and some below the weekly chart also and the important range of averages is between 48309---48281---48269---48173(figures will change every day), sustained close above this range may provide good strength and an impetus to move up.

4. It is below some of its medium term moving averages on the daily chart.

5. It is below its pullback threshold point of 47941.45(figure may change), if it closes above it and sustains then it will give a ray of hope for a meaningful up move.

6. It has broken its recent bottom on the line and bar chart.

7. Technical indicators are weak on the daily/weekly and monthly charts and pointing that it could head down to much lower levels in coming days/weeks and months.

8. The price action has been more or less consistently weak for the last few days.

OVERALL VIEW:--The overall technical setup is weak as of now; therefore further fall looks inevitable in coming days but a short relief rally can happen any day before further resumes. Since it is in correction mode therefore it is sell on the rise market now or sell on the price breakdown. So for safe traders it is suggested to avoid long trade till it closes above 47941.45 at least and sustain or till visible sign of correction completion emerges on the down side. But aggressive traders can try long trade on decline at important support points or range for pullback gains. The long term trend is still up, but the short term bias is hugely negative as of now.

TRADING CALL: --                                                                    

1. Aggressive traders can try long trade on decline near 47313 if it hold it for some time with a stop loss of 47200 or on the sharp decline near or  within the range of 46861-----46580 with a stop loss of 46450.

2. Short trade can be tried on the rise near or within the range of 47850 —47950 with a stop loss of 48100 or can sell below 47240 with a stop loss of 47430.  It could be a risky trade but can be tried 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

Email—suranank@gmail.com

Mobile—8240951127/9831313654.