A TECHNICAL UPDATE ON CNX-BANK NIFTY—25.10.2024

 

CNX-BANK NIFTY

Open—51272.30--High—51781.55--Low—51201.85--Close—51531.15 on 24.10.2024.

 

Support:51138.90/51133.20/51000.90/50947.70/50369.40/49974.75/49654.65/49530.45/49057.40/48636.45/48313.60/48292.25/48203.45/48161.75/47435.75/46983.75/46579/46077.85. 

Resistance:51577.50/51750.10/51996.65/52199.45/52340.25/52782.75/52794.95/53357.70/53741.40/54467.35/54593/54604/54772/54815/54924/55097/55209/55444/55646/55827/56135/56218.

OVERALL, VIEW: --

It opened on a positive note and thereafter had both side moves during the day and finally ended the day with a gain of 292.15 points. The overall chart setup is still weak, it is already into the deep correction mode for earlier rise, it is also into correction mode for its recent rise as it is below its threshold point of 52015.06(figure may change) today, it is below all its short term & below almost all medium term moving averages on the daily chart and almost below all short term moving averages on the weekly chart and broken its recent bottom of 51288.80 on the line chart, all together it is still giving weak sign and if it sustains below the averages on the closing basis then further fall looks certain. Furthermore almost all the important technical indicators are still negative on the daily chart and this is concerning, and indicates that further fall cannot be ruled out in coming days with intermittent relief rallies. It is in the long term uptrend as of now but the short & medium term bias is still bearish as of now. The undertone is weak.

POSSIBLE MOVE ON THE UPSIDE:-

The only good thing it that it is still above its strong pullback threshold point of 51202.74(figure may change) and today it rallied up. Please note that as long as it sustains above it on the closing basis the chances of up move will be alive and it can extend the up-move and the possible broad upside target could be 51827----52331----52835---53459----53613---53639.71. Please note that to gain a strong foothold it has to move above 51592----51765----51876----52015.06---52309----52487.43(figure may change) and sustain on the closing basis, and if it moves above the range of 53331.55-----53357.70----53410----53500.30(figure may change) and sustain on the closing basis it may gain good strength for the continuation of the up move and it will get into the strong up momentum track if it moves above 53613 & 53636.71(figure may change) and sustain on the closing basis.

POSSIBLE MOVE ON THE DOWNSIDE:-

Moving down from here it may find broad support at (for other support points see the table on the upside) 51202.74-----50935-----50809------50742-----50725.76----50617-----50614------50440-----50297---49968----49737-----49716----49654.65------49426-----49391----49354----49201.72-----49069-----48636.45---48292.25---48203.45---47756(figures may change), it can bounce back from any of these points,  break & sustained close below 51202.74 (good bounce back point)may end the possibility of a sustained up move for the time being. Please note that the range of 50935-----50809-----50742----50440---50297 and then 49968---49737---49716----49654.65---49391(figure will change every day) is a very strong bounce back support range, but break & sustained close below 50935 will threaten the long term uptrend and thereafter break & close below each point will weaken it further, break and sustained close below 49069 will potentially threaten the long term uptrend and finally if it break the range of 48636.45---48292.25---48203.45---47756 and sustains on the closing basis then the correction could be more painful price-wise & time-wise both, which may please be noted.

TECHNICAL INDICATORS PLACEMENT ON THE DAILY, WEEKLY & MONTHLY CHART:-

It is important to mention here that it is having a see-saw movement quite often with huge volatility, which is not good sign for a steady market, the overbought condition on the monthly chart is still present, but  on the daily & weekly chart  it is slightly oversold or may be neutral at this point of time, and showing a positive divergence on the daily chart so it may have pullback again, and it did move-up today , but pullback rallies  are treacherous in nature and may end abruptly because the overall technical indicators are weak and most importantly  huge negative divergence  is there on the  weekly chart and it appeared on the monthly chart too and sell  mode is also there on the daily & weekly chart as of now and it appeared on the monthly chart also , so all together these developments are concerning, therefore, all indication together based on the  indicators on the daily, weekly & monthly chart is pointing that it could head down  and may seek much lower levels in coming days. So please be alert and cautiously approach the market now.

IT IS SELL ON THE RISE MARKET NOW IN GENERAL;-

It is into the deep correction mode therefore it is sell on rise market now in general till it gets out of the correction mode or give visible sign of correction completion, but aggressive traders can try both side trades depending on the price action for intraday gains, but long trade could be a risky affair.  

NOTE: - IT IS INTO DEEP CORRECTION MODE FOR EARLIER RISE AND IN CORRECTIVE MODE FOR ITS RECENT RISE, LONG TRADE CAN BE TRIED IF IT HOLDS 51202.74 LEVELS (FIGURE MAY CHANGE), ELSE AVOID.

STRENGTH: -

1. It is in the long-term uptrend, but break and close below 50935 will threaten the uptrend.

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

3. Two out of seven important indicators is positive on the daily chart, indicating oversold or neutral condition and slight positive divergence now..

4. It is above its strong pullback threshold point of 51202.74(figure may change).

5 The price action was positive today.

WEAKNESS: -

1. Volatility and wild swing 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.

2. Five out of seven important indicators on the daily chart are negative and in sell mode, given negative divergence, but in oversold zone now, so it may give a relief rally before sliding down further as it did today. Please note that indicators, on the weekly & monthly chart, also indicating overbought condition, sell signal and negative divergence too.

3. It is into correction mode today as it closed below some of the correction threshold points of 53636.71-----53500.30---53331.55--52487.43---52098.30----52015.06----51549.93---- (figures may change). The other important correction threshold points are at 51492.11---- 50725.73----49201.72---45416.49 (figure may change) and if it sustain below these points correction will deepen.

4. It is below its correction threshold point of 52015.06(figure may change) for its recent rise.

5. It has broken its recent bottom on the line chart.

6. It is below all its short-term moving averages now on the daily chart and the important average range for day is between 51582---51592---51598----51607---51765---51876(figure will change every day), sustained close below this range can accelerate the down move.

TRADING CALL: -- 

1. Long trade can be tried on decline near 51202.74 some time with a stop loss of 50980 for a possible intraday gain, else avoid. Please note that long trade in a corrective market could be a risky bet but can be tried at critical support point with strict stop loss for intraday gain.

2. Short trade can be tried on the rise near or within the range of 51850---51950 with a stop loss of 52150.  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.