A TECHNICAL UPDATE ON CNX-NIFTY-16.5.2024.

 

CNX-NIFTY

Open-22255.60—High—22297.55—Low—22151.75--Close-22200.85 on 15.5.2024.

Support:22126.80/21883/21875/21860/21777.65/21710.20/21530.20/21448.45/21137.20.

Resistance:22224.35/22297/22305.25/22348.05/22526.60/22554.68/22568.40/22678.85/22730/22775.70/22783.35/22794.70.

It opened on a positive note and then had both side moves during the day and finally ended the day with a meager loss of 17.30 points. After two days of rise it took a breather today but as long as it sustains above its important points of 22185.10 & 22126.80 and finally above its pullback threshold point of 22051 chances of up move will be alive, else down move may continue, because it is still into deep correction mode for its earlier rise therefore further fall may be ahead, so be watchful.

STRENGTH:-

1. It is in the long term uptrend now. But sustained break below 21623(figure will change every day) will threaten the long term uptrend. 

2. The short range for it now is between 22794.70---22305.25(it is below this range now) and the long range is between 22794.70----21777.65.

3. It is well above its critical points of 21801.45---21777.65---21731.40---21727.75 & 21710.20, which is must to keep the up momentum going in the year 2024.

4. It is above its pullback threshold point of 22051(figure may change) and if it sustains above it on the closing basis then the rally can extend and the possible upside target or resistance points could be at 22308----22423---22526.60---22565---22600.

5. Moving down the possible good bounce back support point could be at 22193---22185.10---22126.80---22051----22018---21981---21860----21777.65----21710.20, break below 22185.10 will push it into correction mode for its recent rise, break below 22126.80 could be a warning sign and break below 22051 may end the on-going rally, sustained break below 21981 can pull it down to 21777.65 & 21710.20 levels and finally sustained break below these points 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 21777.65 & 21710.20 is a very strong and may be the last bounce back support points as of now or make or break point or benchmark points. So be watchful.

6. It is above its important key point of 22126.80.

7. The price action was positive today.

WEAKNESS:-

1. It is still into the correction mode for its earlier rise.

2. It is way below its up momentum threshold point of 22526.60.

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 22318---22300---22293 (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 has broken its recent bottom on the line and bar chart.

6. 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.

OVERALL VIEW: -- The overall technical setup is weak as of now; therefore further fall may be ahead in the coming days. But as long as it holds its key point of 22185.10 & 22126.80 and its pullback threshold point of 22051 chances of up move will be alive and rally can extend further. Therefore for safe traders it is suggested to try long trade if it holds 22126.80 & 22051 on the closing basis else avoids. The aggressive traders can also try long trade on sharp decline at important support points or range for pullback gains but be alert and cautious, because it is still in the correction mode therefore it is sell on the rise market now in general or sell on the price breakdown. The long term trend is still up, but the short term bias is negative as of now.

TRADING CALL: --

1. Aggressive traders can try long trade on decline near or within the range of 22150---22127 with a stop loss of 22020 or on the sharp decline near or within the range of 21821---21777.65 with a stop loss of 21690 or can buy if it moves above 22237 and maintain for some time with a stop loss of 22150.

2. Short trade can be tried on the rise near or within the range of 22330--- 22370 with a stop loss of 22420. 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

Mobile—8240951127/9831313654.

Email--- suranank@gmail.com