A TECHNICAL UPDATE ON CNX-NIFTY-6.6.2024

 

CNX-NIFTY

Open-22128.35—High—22670.40—Low—21791.95--Close-22620.35 on 5.6.2024.

Support:22526.60/22417/22303.80/22297/22224.35/22126.80/21860/21821.05/21801.45/21777.65/21731.40/21727.75/21710.20/21530/21281.65/21137.20/20976.80/20769.50/20507.75/20291.55/20222.45.

Resistance:22775.20/22794.70/23110.80/23282/23338.70/23397/23456/23525/23573/23630/23768/23804.

It opened on a positive note and thereafter had wild swings both ways during the day and finally ended the day with a handsome gain of 735.85 points. After yesterdays massive fall it staged a smart recovery today from within its last critical support range of 21883----21821.05---21801.45---21777.65---21776.87---21731.40---21727.75 & 21710.20, which shows strength, it also closed above its momentum threshold point of 22526.60 which is a positive sign. But please note that today’s sharp recovery was a reflex action of yesterday’s  sharp fall, furthermore today’s up move lacked volumes, therefore it has to be seen over next 1-2 trading sessions that whether it will sustain this up move or not. However as long as it holds its most critical range as mentioned above the chances of the up move will always be there, else it may head down again.

STRENGTH:-

1. It is in the long term uptrend now. Break below 21883 will threaten the long term uptrend.   

2. It is well above its critical points of 21821.05---21801.45---21777.65---21776.87---21731.40---21727.75 & 21710.20, which is must to keep the up momentum going in the year 2024. Sustained break below this range may witness accelerated fall.

3. It is well above its pullback threshold point of 21776.87(figure may change), and if it sustains above it then the possible broad upside target points could be at 22820---22885----22961---22980.53----23110.80---23121.81----23338.70 Please note that if it moves above 22961 and sustain on the closing basis then it could retest its all-time high of 23338.70 or may go beyond it.

4. It has bounced back almost above all its short & medium  term moving averages on the daily and weekly chart, and the important range is between 22724----22631----22617---22598----22564----22526.60----22513(figure will change every day), sustained break below this range can trigger down move again.

5. One out of five important technical indicators is positive on the daily chart.

WEAKNESS:-

1. It slipped into deep correction mode for its earlier and its recent rise and it will get out of all corrective mode once it moves above 22819.15----22980.53---23110.80 & 23121.18 and sustain on the closing basis.

2. It has broken all tops & bottoms on the line chart and bar chart at one go on 4.6.2024.

3. Some important technical indicators are weak on the daily/weekly and monthly charts and pointing that it could head down to lower levels in coming days/weeks and months.

4. Volatility can be seen in the market quite often, which is not a good sign for a steady market condition and it can eventually drag it down may be drastically in the coming days/weeks and months. So be watchful. 

5. The price action has been mixed for the last few days and today it was weak.

OVERALL VIEW: -- It had a sharp bounce back today but it looks little dicey, therefore it has to be seen in the next 1-2 trading sessions that whether it will sustain or not, however as long as it holds the range of 21883----21821.05---21801.45---21777.65---21776.87---21731.40---21727.75& 21710.20 chances of continuation of the up move will be alive, else it may drift down. But please be alert if it moves below 22526.60 & 22417 and sustain. Since it is in deep corrective mode therefore it is sell on the rise market now in general, but long trade can also be attempted at crucial and critical support point with strict stop loss for pullback gains.

TRADING CALL: --

1. Long trade can be tried on decline near 22530 with a stop loss of 22470, else avoid.

2. Short trade can be tried on the rise near or within the range of 23080---23121 with a stop loss of 23180 or can sell if it moves below 22400 with a stop loss of 22540. 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