A TECHNICAL UPDATE ON CNX-BANK NIFTY—4.12.2024

 

CNX-BANK NIFTY

Open—52357.95--High—52780.90--Low—52216.85--Close—52695.75 on 3.12.2024.

 

Support:52577.50/52493.95/52354.85/51996.65/51750.10/51138.90/51133.20/51000.90/50947.70/50865.45/50438.30/50382.10/50369.40/50194.30/49974.75/49904.40/49787.10/49688.80/49654.65/49057.40/48636.45/48292.25/48203.45/48161.75/47363.40/46983.75/46077.85/45828.80/45661.75/44633.85/44429/43600.25/43345.45/43230.95/42582.20/42105.40. 

Resistance:52760.20/52782.75/52794.95/53180.75/53357.70/53792.85/54247.70/54467.35.

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 586.75 points. The stipulated time to fill the gap it created on 25.11.2024 is over therefore the chances of filling the gap has receded for now but some day it fill the gap for sure(gap point is 51271), which may please be noted.

Please note that it was already into the deep correction mode for its earlier rise, but if it hold the points of 52578----52494----52355---52074.36----52055.60  and then in the worst case scenario 51423 & 50891.64 (some figure may change), then it can extend the up-move, but break & sustained close below 52074.36 will push it into corrective mode again for its recent rise, break & sustained close below 51423 will threaten the long term uptrend again, break & sustained close below 50891.64 (figure may change) may end the possibility of continuing the up move for good for a while. It is important to mention here that to keep the up-momentum going in the month of December-2024 it has to sustain above 52055.60

The overall chart setup has improved, 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 it 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 only concerning thing is that it is in the overbought zone, so it may correct. So all together indicators are giving positive signal as of now therefore it is likely to move-up in coming days provided it holds the key points as stated in the above paragraph. The long term uptrend is intact as of now.

POSSIBLE MOVE ON THE UPSIDE:-

Please note that if it holds the range of 52578----52494----52355---52074.36----52055.60 (some figure may change) the up-move is likely to extend further, but to get 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 53531.30 & 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) 52578----52494----52402----52355---52255-----52074----52058.55----52055.60----51917---51866-----51700----51524----51423---51090----51016----50891.64----50769------50699----50617------50410----50395------50088-----50081----49775---49751-------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 the range of 52578----52494----52355 will make a dent in the continuation of the up-move, break & sustained close below 52074.36 will push it into corrective mode again for its recent rise and thereafter break & sustained close below each point will weaken it, break & sustained close below 51423 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 50699 may trigger fresh fall and thereafter break & close below each point will weaken it further, but the range of 50081----49751----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 49751 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 almost all indicators are negative ,sell mode is on , there is huge negative divergence but the only comforting thing is that it is in oversold zone, so today’s up-move can extend a bit, so watch out. 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. The undertone is still bearish as of now. 

IT IS BOTH SIDE TRADEABLE MARKET NOW.;-

Both side trades can be attempted depending on the price action for intraday gains. But since it is showing some strength in the chart setup therefore preferably long trade can be tried on decline.  

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 strong pullback threshold point of 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. The price action was positive today.

6 It is above all its short-term moving averages now on the daily chart and the important average range for day is between 52255----52074-----51917-----51700----51635----51524-----51016---50699(figure will change every day), sustained close above this range can help it extend the up-move.

7. It has made higher top  on the line & bar chart both.

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 oversold (so it may rally a bit), but in sell mode and with huge negative divergence & monthly chart, indicating overbought condition and huge negative divergence.

3. It is into deep correction mode as it is below some of the correction threshold points of 53636.71-----53500.30---53331.55---- (figures may change). The other important correction threshold points are at 52487.43--- 52098.30----52058.55----52015.06----51549.93---- 51492.11 ---- 50725.73---- 49201.72---45416.49 (figure may change) and if it sustain below these points correction will deepen.

TRADING CALL: -- 

1. Long trade can be tried on decline near or within the range of 52550----52500   with a stop loss of 52200 or can buy if it moves above 52761 and maintain for some with a stop loss of 52540 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 53200---53300 with a stop loss of 53400. 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.