A TECHNICAL UPDATE ON CNX-NIFTY-22.10.2024

 

CNX-NIFTY

Open-24956.15--High-24978.30—Low---24679.60---Close-24781.10 on 21.10.2024.

Support:24753.15/24694.35/24567.65/24472.80/24141.80/24099.70/24074.20/23893.70/23667.20/23664/23350/23338.20/23110.80/22794.70/22775.70/22526.60.

Resistance: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 and thereafter had both side moves during the day and finally ended the day with a loss of 72.95 points. It had extremely volatile session today. 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 almost 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. The only positive thing is that it is still holding on to its key support range on the closing basis. It is in the long term uptrend as of now but the short & medium term bias is bearish as of now.

POSSIBLE MOVE ON THE DOWNSIDE:-

Moving down from here it may find good support at 24753.15----24725---24694.35----25567.65----25521.63-----24456-----24370-------24183-----24099.70-----24074.20----24047.39-----23893.70(few figures may change Daily) it can bounce back from any of these points, as long as it holds the range of 24753.15----24725---24694.35(it did break all these points intraday today but managed to close above it) chances of the up- move will be alive, but break & sustained close below this range may accelerate the fall 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 24183 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:-

Please note that it is still below its key resistance points of 24971.14(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 24971.14 and sustain on the closing basis then the chances are that it can extend the up move and it moves above 25106.68 and sustain on the closing basis then it will come out of corrective mode for its recent rise and it may provide firmness to the up-move. But to gain a strong foothold it has to move above the range of 25114---25185----25322----25363(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  monthly chart is still present, but  on the daily & weekly chart  it is in the oversold or neutral zone now, and showing slight positive divergence on the daily chart 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 it appeared on the monthly chart too and sell  mode is also there 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 in coming days may be with an in between short relief rally at times. The undertone is weak.

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;--LONG TRADE CAN BE TRIED IF IT HOLDS THE RANGE OF 24753.15----24725---24694.35 (SOME FIGURE MAY CHANGE) ,ELSE AVOID.

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. It is above its feeble pullback threshold point of 24725(figure may change).

4. The price action was positive today.

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

WEAKNESS: -.

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

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 all its short-term moving averages now on the daily chart and the important average range for the day is between 24911---24950----24976----25082----251114----25322 (figure will change every day), sustained close below this range can accelerate the down move.

5. It is below its strong pullback threshold point of 24971.14(figure may change).

6. It has broken its entire recent bottom on the line & bar chart and made lower top today on the line chart..

TRADING CALL: --

1. Long trade can be tried on decline near or within the range of 24753--24725 with a stop loss of 24670 or if it moves above 24855 and maintain for some time with a stop loss of 24770 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 25000—25040 with a stop loss of 25110 or can sell if it moves below 24670 with a stop loss of 24760. 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