A TECHNICAL UPDATE ON CNX-BANK NIFTY—19.11.2024

 

CNX-BANK NIFTY

Open—50312.45--High—50445.80--Low—50074--Close—50363.80 on 18.11.2024. 

Support:50194.30/49974.75/49904.40/49688.80/49654.65/49057.40/48636.45/48292.25/48203.45/48161.75/47363.40/46983.75/46077.85/45828.80/45661.75/44633.85/44429/43600.25/43345.45/43230.95/42582.20/42105.40. 

Resistance:50369.40/50382.10/50438.30/50865.45/50947.70/51000.90/51133.20/51138.90/51750.10/51996.65/52354.85/52493.95/52577.50/52782.75/52794.95/53180.75/53357.70/53792.85/54247.70/54467.35.

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 184.25 points. The overall chart setup is weak; it is still into the deep correction mode, It is below all its short & medium term moving averages on the daily chart and also below all its short term & few medium term moving average on the weekly chart and below few short term moving average on the monthly chart too and most importantly it is also below few long term moving average also, it has made lower top & bottom on the line chart again and finally almost all important technical indicators have also turned negative on the daily chart and in sell mode. Therefore all development together are concerning and indicates further fall may be ahead in the coming days. Please note that to give a hope of moving up it has to move above the range of 50535.15----50588---50906---50981.26----51245(figure may change) and sustain on the closing basis in a shortest possible time, else it will keep going down with in between relief rallies. But going down it has strong bed of support in the range of 49910----49446(figure will change daily), it is  supposed to be a strong bounce back range but if it breaks this range and sustain on the closing basis then it may have free fall. The short & medium term trend is bearish and it has threatened the long term uptrend and the threat will only dissipate once it moves above 50588---50906 & 51245(figure will change daily) and sustain on the closing basis.

POSSIBLE MOVE ON THE UPSIDE:-

Please note that to give a ray of hope for a continued up move it has to move above 50535.15----50981.26 & 51245 (figure may change) and sustain on the closing basis, if it moves above 50535.15(weak pullback threshold point) and sustain on the closing basis then it may have feeble up-move, if it moves above 50981.26(strong pullback threshold point) and sustain on the closing basis then it may somewhat ensure the up-move can extend for sure and if it moves above 51245 and sustain on the closing basis then it will end the long term uptrend threat and then it may have smooth up-move. Please note that to get reasonable strength for the up-move to continue it has to move above the range of 51280----51320---51410----51475.35----51550.15----51692(figure may change), to gain a strong foothold it has to move above 52355---52494----52578 and sustain on the closing basis and for the strong strength for the continuation of the up-move it has to move above the range of 53331.55-----53357.70----53500.30(figure may change) and sustain on the closing basis and it will get into the strong up momentum track if it moves above 53555 & 53636.71(figure may change) and sustain on the closing basis and then it could retest its all-time high of 54467.35 or can go beyond it also.

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) 50240----50098-----49910----49774-----49654.65----49603----49446-----49201.72-----48636.45---48292.25---48203.45---47756(figures may change), it can bounce back from any of these points, please note that if it remains below 50617 on the closing basis then it can come down to 49654.65 or lower levels. Please note that the range of 49910----49446 is a very strong bounce back support range, if it break & sustain below this range on the closing basis, then it may have an accelerated fall. It has already threatened the long term uptrend as it is below its main threshold point of 51245, break and sustained close below 49446 may potentially end the long term uptrend for the time being 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, now  it has oversold  condition , in sell mode  but slight positive divergence on the daily chart, so the on-going  up-move for the last two days may extend a bit but may not last , it is in the sell mode, huge negative divergence but oversold condition on the weekly chart and on the monthly chart it is still overbought and with negative divergence , therefore all indication together based on the indicators on the daily, weekly & monthly chart is pointing towards weakness and  it could head down further and may seek lower levels in coming days with intermittent relief rallies because technical parameters are weak. So watch out how it pans out in next few days, but sustained close below 50617(figure may change) can drag it 49654 or lower levels..

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.  

STRENGTH: -

1. It is still in the long-term uptrend; but uptrend it threatened.

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  condition, in sell mode but not yet broken bottom on the indicator.

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, slight positive divergence, in the oversold/neutral zone and in the sell mode. Please note that indicators, on the weekly chart is oversold (so it may rally a bit), but in sell mode and with huge negative divergence & monthly chart, indicating overbought condition, sell signal and negative divergence too.

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

4 The price action was mixed today.

5. It slipped into correction mode for its recent rise today as it closed below its threshold point of 52015.06(figure may change).

6. It is well below its strong pullback threshold point of 50981.06(figure may change), sustained close below the above point may witness an accelerated fall.

7. It has made lower top & bottom on the line chart again.

8 It is below all its short-term moving averages now on the daily chart and the important average range for day is between 50971----51017---51280---51289---51320----51410----51496—51537----51692(figure will change every day), sustained close below this range can drag it down further.

TRADING CALL: -- 

1. Long trade can be tried on decline near or within the range of 50177------50088 with a stop loss of 49900 or if it moves above 50455 and maintain for some time with a stop loss of 50250 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 50650---50750 with a stop loss of 50850 or can sell if it moves below 50074 and then below 49900 with a stop loss of 50280 & 50100 respectively. 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.