A TECHNICAL UPDATE ON CNX-BANK NIFTY—16.12.2024

 

CNX-BANK NIFTY

Open—53109.80--High—53654--Low—52264.55--Close—53583.80 on 13.12.2024. 

Support:53531.30/53357.70/52794.95/52782.75/52760.20/52577.50/52493.95/52354.85/51749.45/51693.50/51138.90/51133.20/51000.90/50947.70/50865.45/50438.30/50382.10/50369.40/50194.30/49974.75/49904.40/49787.10/49688.80/49654.65/49057.40/48636.45/48292.25/48203.45/48161.75/47363.40/46983.75/46077.85/45828.80/45661.75/44633.85/44429/43600.25/43345.45/43230.95/42582.20/42105.40. 

Resistance:53792.85/53888.30/54247.70/54467.35/54593/54604/54772/54815/54924/55097/55209/55444/55646/55740/55827/56135/56255.

OVERALL, VIEW: --

It opened on a negative note and thereafter had both side moves during the day and finally, ended the day with a gain of 367.35 points. Please note that the gap it created on 25.11.2024 is yet to be filled and the gap point is 51271. Please note that it is often exhibiting volatility and today was one such day, which is not a good sign for a steady market.

Today there was huge volatility, it dipped sharply in the first session but staged sharp recovery in the 2^nd half of the day thereby showed good strength and crossed its recent lower top on the line chart and also got out the short corrective mode for its recent rise and closed above its key points, which is a positive sign for the continuation of the up-move. Although it closed above its key points of 53370.43 & 53531.30 and if it sustain above 53531.30 on the closing basis then it could retest its all-time high of 54467.35 or may go beyond it also, but it is important to mention here that today’s movement and volatility near the recent previous top which was at 53888.30(made on 5.12.2024) also signifies that the top is already in the place for now till it moves above it and sustain  on the closing basis. Therefore it is suggested to be fearful and cautious in the long trade till it closes above 53888.30 and sustain because it could be a bull trap also.

The technical setup indicates that the up-move may extend further, but today’s movement indicates that this up-move can only extend if it moves above 53888.30 and sustain on the closing basis else it may start to drift down again, so watch out next 1-2 trading sessions how it pans out. However even if it moves down from here but holds the points of 53531.30----53370.43---52920.42 & 52648(some figure may change) on the closing basis then the chances of up-move will still be alive.

The overall chart setup is good. It is above all its short, medium and long term moving averages on the daily, weekly & monthly chart which is a hugely positive sign for the continuation of the up-move and if it sustain above the averages then the up-move is surely going to extend. Furthermore almost all the important technical indicators are positive now on the daily chart and indicate that it is in the buy mode. The concerning thing is that it is in the overbought zone and with slight negative divergence, but all the other indicators are giving positive signal for continuation of the up-move but in view of negative divergence some caution must be exercised. It is also important to mention here that the price action has not been consistently positive therefore it is suggested to keep an eye on price action for further directional indication. The long term uptrend is intact as of now.  

POSSIBLE MOVE ON THE UPSIDE:-

Please note that if it holds 53531.30----53370.43---52920.42 & 52648(figure may change) on the closing basis then the up-move is likely to extend further. It is looking good and if it moves above 53531.30---53644.50 & 53888.30(it is already above 53531.30) and sustain on the closing basis then it may retest its all-time high of 54467.35 or may go beyond it also. But if it stays below these points for a longer period of time on the closing basis then the on-going up-move may end for good for a while.

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) 53531.30----53370.43---52920.42-----52880---52661----52648-----52442----52126----52085-----52087.65----52055.60----51921------51771----51673-----51617-----51607----51348----51308----51017-----50976----50891.64------50661----50617------50346------50024-------49654.65----49201.72-----48636.45---48292.25---48203.45---47756(figures may change), it can bounce back from any of these points, but break & sustained close below 53531.30 will trigger first weakness, break & sustained close below 53370.43 will push it into short correction mode for its recent rise, break & sustained close below 52920.42 will push it into deep corrective mode for its recent rise, break & sustained close below 52648 may put the up-move in jeopardy and thereafter break & sustained close below each point will weaken it, break & sustained close below 51673 will threaten the long term uptrend, break & sustained close below 50891.64 may end the possibility of the up move for a while, break & sustained close below 50976 may trigger fresh fall and thereafter break & close below each point will weaken it further, but the range of 50346----50024----49787----49654 is the last very strong bounce back support range, if it break & sustain below this range on the closing basis, then it may have an accelerated fall. Please note that sustained close below 50024 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 WEEKLY & MONTHLY CHART:-

On the weekly chart indicators are giving mixed signal, it is in buy mode now, but there is huge negative divergence and in overbought zone. On the monthly chart it is in overbought zone and with huge negative divergence. Therefore all together indicators on the weekly & monthly chart as of now indicates that it is not yet out of woods and further fall is very much on the horizon in coming weeks and months. So keep a watch on the price action for further directional indication.

IT IS BUY ON DECLINE MARKERT NOW.;-

It is buying on decline market now till it holds 53531.30----53370.43----52920.42 & 52648(figure may change) but short trade can also be attempted after a reasonable rise for intraday corrective gain. It could be a risky trade but worth trying.

STRENGTH: -

1. It is in the long-term 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 It is well above its short & strong pullback threshold point of 52648 & 50891.64(figure may change), sustained close above this point will help in extending the up-move.

4. All the important technical indicators are positive on the daily chart with buy signal, but in overbought zone as of now.

5 It is above all its short-term moving averages now on the daily chart and the important average range for day is between 53394----53236----53138-----52880-----52661----52285----51308-----50976(figure will change every day), sustained close above this range can help it extend the up-move.

6. It is above all its corrective threshold points of 53500.30-----53370.43---53331.55----, 52920.42----52487.43--- 52098.30------51549.93---- 50725.73---- 49201.72---45416.49 (figure may change) and if it sustain above these points then it will help in extending the up-move.

7. It has crossed its recent top on the line chart.

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. Please note that indicators, on the weekly chart is in buy mode but in overbought zone and with huge negative divergence & on the monthly chart, indicating overbought condition and with huge negative divergence.

3. The price action was mixed today.

TRADING CALL: -- 

1. Long trade can be tried on decline near or within the range of 53531----53370 if it hold this range for some time, then with a stop loss of 53200 for a possible intraday gain, else avoid.

2. Short trade can be tried on the rise near or within the range of 53950---54000 with a stop loss of 54150. 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.