A TECHNICAL UPDATE ON CNX-NIFTY-18.10.2024

 

CNX-NIFTY

Open-25027.40--High-25029.50—Low---24728.90---Close-24749.85 on 17.10.2024.

Support:24694.35/24472.80/24141.80/24099.70/24074.20/23893.70/23667.20/23664/23350/23338.20/23110.80/22794.70/22775.70/22526.60.

Resistance:24753.15/24854.80/24885.15/25078.30/25285.55/25333.65/25445.70/25847.35/26277.35/26328/26995/27095/27212/27293/27381.

OVERALL, VIEW: --   

It opened on a positive note but did not move much further after that and thereafter steadily moved down during the day and finally ended the day with a loss of 221.45 points. The overall chart setup is very weak, it is already into the deep correction mode and also into correction mode for its recent rise, it is still below all its short term moving averages and below few medium term moving averages on the daily chart and below few short term moving averages on the weekly chart also and all the important technical indicators are negative now, therefore all developments together indicates that further fall looks inevitable in coming days with in between relief rallies and the process is on. It is in the long term uptrend as of now but the short & medium term bias is hugely bearish as of now

POSSIBLE MOVE ON THE DOWNSIDE:-

Moving down from here it may find good support at 24694.35----25521.63-----24456-----24370-----24368-----24153-----24099.70-----24074.20----24047.39-----23893.70(few figures may change Daily) it can bounce back from any of these points, it has broken its first key bottom of 24753.15(strong bounce back point) today and if it breaks & close below its most important bottom of 24694.35(strong bounce back point) and sustain on the closing basis then the fall may accelerate and thereafter break and close below each point will weaken it further. and break and sustain close below 24370 can drag it down to 23893.and break and sustained close below 24153 will threaten the long term uptrend and finally break & sustained close below 23893.70 and may trigger fresh big down move and if sustain below this point on the closing basis then the correction could be more painful price-wise and time-wise both.

POSSIBLE MOVE ON THE UPSIDE:-

Similarly moving up its key resistance points are 24848.12(feeble pullback threshold point, figure may change), 25067.94(strong pullback threshold point, figure may change) and 25106.68(correction threshold point for its recent rise, figure may change). Please note that if it moves above 24879.48 and sustain on the closing basis then the chances is that it could give a feeble up move  and if it moves above 25067.94 & 25106.68 and sustain on the closing basis then the chances are that it could extend the up move with firmness. Please note that to gain a strong foothold it has to move above the range of 24968----25056----25180----25190---254401(figure may change) and sustain on the closing basis, and if it moves above 25714.81 & 25917.64(figure may change)  and sustain on the closing basis then it may gain good strength for the continuation of the up move and it will get into the good up momentum track if it moves above 26043.29 (figure may change) and sustain on the closing basis.

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

It is important to mention here that it is having see-saw movement quite often with huge volatility, which is not good sign for a steady market, the overbought condition on the weekly and monthly chart is still present, but  on the daily chart  it is in the oversold zone now, and showing slight positive divergence so it may stage a short rally, but it may not last  because the overall technical setup is weak and most importantly  huge negative divergence  is there on the weekly chart and sell  mode also triggered on the daily & weekly chart, so all together these developments are concerning, therefore, all indication together based on few indicators on the daily, weekly & monthly chart is pointing that it  may slide further may be with a in between short relief rally at times.

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

It is into the 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;--FOR SAFE TRADERS IT IS SUGGESTED TO AVOID LOND TRADE TILL IT CLOSES ABOVE 24848.12(FIGURE MAY CHANGE) AND SUSTAIN.

STRENGTH: -

1. It is in the long-term uptrend now.   

2. It is far-far above its most 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. One out of seven indicators is positive now showing slight positive divergence.

WEAKNESS: -.

1. Six out of seven important technical indicators on the daily chart, indicating overbought condition, sell mode and negative divergence, few indicators on the weekly chart also indicates overbought condition and negative divergence and finally monthly chart also indicates overbought condition.    

2. 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.

3. It is into correction mode now as it closed below some of the correction threshold points of 26043.29----25917.64---25714.81----25106.68 ----25098.32 -----25064.27 (figures may change). The other important correction threshold points are at 24521.63---24047.39----23659.18---21848.52 (figure may change) and if it sustain below these points correction will deepen. 

4. It is below almost all its short-term moving averages now on the daily chart and the important average range for today is between 24963---24968----25056----25180----25190----25401 (figure will change every day), sustained close below this range can accelerate the down move.

5. It is below its pullback threshold point of 24848.12 & 25067.94(figure may change).

6. The price action was weak today.

7. It has broken its entire recent bottom on the line chart.

TRADING CALL: --

1. Long trade can be tried on decline near 24695 with a stop loss of 24630 or if it moves above 24753.15 and maintain for some time with a stop of 24670 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 24950—25000 with a stop loss of 25070 or can sell if it moves below 24690 with a stop loss of 24770 or can sell if it remains below 24753.15 for some time with a stop loss of 24850. 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