A TECHNICAL UPDATE ON CNX-BANK NIFTY—20.12.2024

 

CNX-BANK NIFTY

Open—51428.45--High—51789.85--Low—51263.75--Close—51575.70 on 19.12.2024. 

Support: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:51693.50/51749.45/51749.45/52354.85/52493.95/52577.50/52760.20/52782.75/52794.95/53357.70/53531.30/53792.85/53888.30/54247.70/54467.35/54593/54604/54772/54815/54924/55097/55209/55444/55646/55740/55827/56135/56255.

OVERALL, VIEW: --

It opened on a negative note and thereafter had both side moves during the day and finally, ended the day with a loss of 563.85 points. Please note that the gap it created on 25.11.2024 is filled today the gap point was 51271. But the gap it created today is still there and if it makes an effort to fill the gap in the next 4—5 trading sessions, which is technically possible then it can come up to 52011, but if it does not fill the gap in the stipulated time then chances of filling the gap will recede for the time being, but it will fill the gap some day. Please note that it is often exhibiting volatility, which is not a good sign for a steady market.

The chart setup has terribly weakened today. It is below all its recent important & key support points on the chart and the long term uptrend is also threatened today, which is a very weak sign. Moving down from here the forthcoming important support points are at 51545----51432----51350-----51189---51016----50891.64----50751----50431----50114(some figure may change daily) and then the last key support range is between 49787.10-----49654.65. Please note that it can bounce back from any of these points but break & sustained close below 51189 can drag it down to 50370 or lower levels, break & sustained close below 50891.64 may end the possibility of a sustained up-move for a while, break & sustained close below 50114 will potentially threaten the long term uptrend and finally break & sustained close below 49654.65 may witness an accelerated fall.

Similarly moving up the key resistance points would be at 51752----51883.14----52055.60----52087.65----52132.82(some figure will change daily). Please note that if it moves above 51752 and sustain on the closing basis then the long term uptrend threat will dissipate, if it moves above 51883.14 and sustain on the closing basis then it will give a ray of hope that it can have a feeble up move and if it moves above 52055.60----52087.65----52132.82 the up-move is likely to extend further. But please note that it may get good strength for the continuation of the up-move if it moves above 52593---52715----52896 & 52920.42 (figure may change daily) and sustain on the closing basis and finally to get back into the strong up-momentum track it has to move above 53370.43---53531.30---53644.50 & 53888.30 and sustain on the closing basis. It is into short & deep correction mode for its recent & earlier rise now and the long term uptrend is also threatened today.

TECHNICAL INDICATORS PLACEMENT ON THE DAILY CHART;-

It has broken its recent bottoms on the line chart, it has fallen below all its short term moving average on the daily & weekly chart, it is below almost all its medium term moving average on the daily chart and below few on the weekly chart also and most importantly it has fallen below one long term moving average also threatening the long term uptrend which is a very sign. Furthermore all the important technical indicators have turned negative  on the daily chart and it has triggered the sell mode in the maximum indicators, negative divergence is there and the only comforting thing is that it is in oversold zone, so it may stage a short relief rally some time and then resume the fall again. It is also important to mention here that the price action has also not been consistently positive off late. Therefore in view of the above further fall is very much on the card in the coming days. So it is suggested to keep an eye on price action for further directional indication. The bias is negative as of now.

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 SELL ON RISE MARKET NOW.;-

It has slipped into deep correction mode today for its recent rise, therefore it is sell on the rise market now till it closes at least above 52088(figure may change)  and sustain, but long trade can also be tried on decline near the  critical support points for intraday gains.

STRENGTH: -

1. It is in the long-term uptrend, but it is threatened today.

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 strong pullback threshold point of 50891.64(figure may change), sustained close above this point will keep the hope alive for the up-move.

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 are 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. It is below few of its corrective threshold points of 53500.30-----53370.43---53331.55----52920.42---52487.43---52098.30------ (figure may change) and if it sustain below these points then it may extend the down move. The other important key correction threshold points are 51549.93---- 50725.73---- 49201.72---45416.49 (figure may change)  

4 It is below its major short-term moving averages now on the daily chart and the important average range for day is between 53082----52896----52818-----52715-----52593(figure will change every day), sustained close below this range can witness an accelerated down move.

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

6. The price action was weak today.

7. All the seven technical indicators are negative on the daily chart with sell signal, distinct negative divergence, but in the oversold zone..

8 It is below its short pullback threshold point of 51883.14(figure may change), sustained close below this point will keep the down move on.

TRADING CALL: -- 

1. Long trade can be tried on decline near or within the range of  51300----51190 for some time, then 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 51900--51970 with a stop loss of 52100  or can sell if it moves below 51250  and maintain for some time with a stop loss of 51480.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.