A TECHNICAL UPDATE ON CNX-NIFTY-8.5.2024.

 

CNX-NIFTY

Open-22489.75-High—22499.05—Low—22232.05--Close-22302.50 on 7.5.2024.

Support: 22297/22224.35/22126.80.21883/21875/21860/21777.65.

Resistance: 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 went up little further and thereafter steadily moved down and finally ended the day with a loss of 140.50 points. It is already into deep correction mode for its recent rise as it is below its threshold point of 22679.19 & 22554.68 and it is also below its momentum gaining threshold point of 22526.60. Furthermore it has also closed below its critical support range of 22444---22440---22418(figure will change daily), which is a very weak sign and sustained break below this range may witness an accelerated fall and moving down the possible bounce back point could be at 22286---22166---22126.80---22018----21981, but sustained break below 21981 may open the possibility to drag it down to its most critical levels of 21777.65  and sustained break below it may drag it down to much lower levels and then the correction could be more painful time wise and value wise both, which may please be noted. It is important to mention here that it may gain some strength above the range of 22418----22440----22444(figures will change daily), but it may get into the up momentum track only if it moves above 22526.60 & 22569 and sustain on the closing basis. The long term uptrend is still on, but since it is into deep corrective mode it may correct further from here. But please note that if it moves above 22364.84 (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, else down move may continue.

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 downward bias. Furthermore it has moved below its short term moving average, it has broken its recent bottom on the line  and bar chart and the price action is also weak, so all together it is indicating that further fall may be ahead. Therefore please note that if these parameters does not improve then the fall is likely to continue. I once again repeat that weekly & Monthly indicators weakness is a major concern and could drag it down further in coming weeks/months. The long term trend is still 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, which it has been giving in the last few days including today, so be watchful.     

NOTE:--MOVING DOWN THE STRONG BOUNCE BACK SUPPORT POINT COULD BE IN THE RANGE OF 22126-----21981 AND THEN AT 21777.65, SUSTAINED BREAK BELOW IT COULD BE A VERY WEAK SIGN.FOR SAFE TRADERS IT IS SUGGESTED TO AVOID LONG TRADE TILL IT CLOSES ABOVE 22526.60 OR VISIBLE SIGN OF CORRECTION COMPLETION EMERGES.     

TRADING CALL: --

1. Long trade can be tried on decline near or within the range of 22126---21981 but not below it with a stop loss of 21950 or can buy near 21780 with a stop loss of 21690. 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 22470--- 22525 with a stop loss of 22580 or can sell if it remains below 22348 for some time with a stop loss of 22450 or can sell if it moves below 22230 with a stop loss of 22350.  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