A TECHNICAL UPDATE ON CNX-BANK NIFTY—6.5.2024

 

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CNX-BANK NIFTY

Open—49375.05--High—49607.75--Low—48659.70---Close—48923.55 on 3.5.2024.

Support: 48636.45/ 48292.25/48203.45/48161.25/47737.20.                           

Resistance:49057.80/49173.36/49262/49396.75/49446.69/49676/49732/49883/49974.75/50005/ 50296/50589.        

It opened on a positive note and went up further but thereafter it steadily moved down and finally ended the day with a loss of 307.50 points. Today’s movement showed gross weakness, it is already into very short correction mode and today it slipped into deep correction for its recent rise as it is below its threshold point of 49446.69 & 49173.36 and it is also below its alert point of 49057.80. But the good point is that it is above its most critical & important points of 48636.45—48475----48334----48303----48292.25 & 48203, please note that if it bounce back from this range then it may resume the up move again, but sustained break below 48636.45 will be a warning sign, sustained break below the range of 48475---48303 will weaken it further and sustained break below 48292.25 & 48203 may derail the up momentum and it may trigger fresh fall and then it can witness accelerated down move. The long term uptrend is on, but since it is into corrective mode it may correct further from here before resuming the up move again. But please note that if it moves above 48970.05(figure may change) and sustain on the closing basis then it will give a ray of hope that there could be a meaningful pullback up move, but it may get into the strong up momentum track only if it moves above the range of 49262----49396.75 & 49446.69 and sustain on the closing basis.   .    

The important technical indicators on the daily, weekly and monthly chart is giving mixed signal pointing that it may have both side moves in coming days/week/months with a slight downward bias. But despite 3 days fall, please note that the moving average placement is still good and the price action is also more or less has been consistently positive, therefore if these parameters remain good the up move may resume in a day or two and eventually all the indicators may also turn positive but as of now indicators weakness is still a concern and could drag it down. The long term trend is up therefore it is buying on decline market in general, but since it is into deep short correction mode now, therefore short trade can also be attempted on the reasonable rise or price breakdown for intraday gains, but be alert and cautious in both side trades. The volatility is still continuing which is not a good sign for a steady market and eventually it can drag it down in coming days/weeks & months, so be alert and watchful and ride the on-going rise with slight caution because it may give severe downside corrective jerk at times as it gave today few days back also.

TRADING CALL: --                                                                   

1. Long trade can be tried on decline near or within the range of 48650-----48400 with a stop loss of 48150. Please note that trying long trade in a corrective mode could be a risky affair but it can be tried at the critical support points for pullback gains.

2. Short trade can be tried on the rise near or within the range of 49580 —49680 with a stop loss of 49800. 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.