A TECHNICAL UPDATE ON CNX-BANK NIFTY—27.12.2024

 

CNX-BANK NIFTY

Open—51395.80--High—51740--Low—50951.80--Close—51170.70 on 26.12.2024.

 

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 positive note and thereafter had both side moves during the day and finally, ended the day with a loss of 62.30 points.  Please note that the gap it created on 19.12.2024 is still there and if it makes an effort to fill the gap in the next 1 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 the 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 overall chart setup is weak. After 23.12.2024 up-move it is taking breather for the last two days but the up move may not be over as yet and it is likely get over once is closes below 50759.20(figure may change), therefore how it culminate has to be seen in the next few trading sessions, as of now it seems that this up-move is a bull trap and may not last long and can fizzle-out abruptly at any moment. Please note that it is below almost all its recent important & key support points on the chart and the long term uptrend is also threatened, which is very concerning therefore further fall looks inevitable in coming days. However moving down from here the forthcoming important support points could be at 51137----51037---50891.64----50885----50782----50750----50563----50488----50458----50240-----50146(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 50891.64 may end the possibility of a sustained up-move, break & sustained close below 50750 may trigger fresh fall and thereafter break & sustained close below each point will weaken it further, break & sustained close below 50146 will jeopardize the long term uptrend and finally break & sustained close below 49654.65 may witness an accelerated fall. The short & medium term trend is down and the long term uptrend is also threatened. The bias is negative as of now.

Similarly moving up the key resistance points would be at 51383.19---51458----51792----52055.60----52087.65----52132.82(some figure will change daily). Please note that if it moves above the range of 51383.19---51458---51792 and sustain on the closing basis then the long term uptrend threat will dissipate and it can extend the up-move, 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 52111—52142----52307-----52547 & 52920.42 (figure may change daily) and sustain on the closing basis and finally to get back into the strong up-momentum track again it has to move above 53370.43---53531.30---53644.50 & 53888.30 and sustain on the closing basis.

TECHNICAL INDICATORS PLACEMENT ON THE DAILY CHART;-

It is making lower top & bottom on line & bar chart both, it is below all its short term moving average on the daily & weekly and below few averages on the monthly chart too, it is below all its medium term moving average on the daily chart and below few on the weekly chart also and most importantly it is below few long term moving average also on the daily chart, which is threatening the long term uptrend and is very concerning. Furthermore all the important technical indicators are 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, therefore it may have a relief rally anytime but it is not likely to sustain and may fail and then it may resume the down move again. It is also important to mention here that the price action is consistently weak for some time. 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.

TECHNICAL INDICATORS PLACEMENT ON THE WEEKLY & MONTHLY CHART:-

On the weekly chart almost all the indicators are negative now, it has triggered sell signal, negative divergence is there 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 and down move is on. 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 51792(figure will change daily)  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 above its long pullback threshold point of 50891.64(figure may change), sustained close above this point will keep the hope alive for an 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 it has triggered sell signal,  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------51549.93---- (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 50725.73---- 49201.72---45416.49 (figure may change)  

4 It is below all its short-term moving averages now on the daily chart and the important average range for day is between 52547----52307----52142-----52111-----51848---51660(figure will change every day), sustained close below this range can witness an accelerated down move.

5. It is making lower top & bottom on the line and bar chart both.

6. The price action was mixed 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 51383.19(figure may change), sustained close below this point will keep the down move on.

9. It is below few long terms moving average now 51792----51458 and the other long term moving average are 51137---50885----50782-----50563-----50458----50240 & 50146, please note that sustained close below these points will weaken it and will drag it down.

TRADING CALL: -- 

1. Long trade can be tried on decline near or within the range of 51050----50950 if it hold this range for some time, then with a stop loss of 50700 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 51700--51800 with a stop loss of 51980  or can sell if it moves below 51030  and maintain for some time with a stop loss of 51220.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.