A TECHNICAL UPDATE ON CNX-NIFTY-4.12.2024

 

CNX-NIFTY

Open—24367.50—High—24481.35---Low---24280---Close----24457.15 on 3.12.2024.

Support:24354.55/24141.80/24099.70/24094.20/24073.90/23893.70/23816.15/23667.20/23664/23484.15/23350/23338.70/23110.80/22794.70/22775.70/22525.65/22303.80/21875.25/21860.25/21821.05/21777.65/21710.20/21530.20/21281.45/21137.20/20976.80.

Resistance:24472.80/24498.20/24537.60/24694.35/24753.15/24854.80/25078.30/25234.05/25285.55/25333.65/25445.70/25871.35/26277.35/26328/26995/27095/27212/27293/27381.

OVERALL VIEW ON THE DAILY CHART: --   

It opened on a flat to positive note and thereafter it had both side moves during the day and finally ended, the day with a gain of 181.10 points.

It had 3^rd up day in a row today and it has been showing good strength for the continuation of the up move and the long term uptrend threat has also ended as it closed above its threshold point of 24371(figure will change daily). But moving up from here it will face very stiff resistance at 24538—24694.35 & 24753.15. Please note that till it moves above 24753.15 and sustain on the closing basis fear of an abrupt fall will always be there but sustained close above this mark will ensure that it may get back into, the strong up-momentum track again and may retest its all-time high or may go beyond it also. Therefore please note that any rise before it closes above 24753.15 and sustain could be a possible bull trap also, therefore it is suggested to ride the on-going rise with utmost alert and caution. Similarly moving down it has strong support points at 24371----24337.86----24193.85---24131.10---23974.50 & 23893.70, break & sustained close below 24371 will threaten the long term uptrend again, break & sustained close below 24337.86 & 24193.85(figure may change) will push it into short & deep correction mode for its recent rise, break & sustained close below 24131.10 will be an alert sign, break & sustained close below 23974.50 will end the possibility of continuing the up-move and finally break & sustained close below 23893.70 will push it back in the very deep corrective mode again and then it may have an accelerated down move and possibly it may break its recent low of 23263.15 made on 21.11.2024 and may seek much lower levels. Therefore moving down 23893.70 is a decider point and moving up the decider point is 24753.15.

The overall chart setup has improved a bit, it has made higher top on the line & bar chart, it is above all its short & few medium term moving averages on the daily chart, above few short & above all medium term moving averages on the weekly and most importantly it is above all its long terms moving average on the daily chart, therefore long term uptrend threat has ended, which is very positive sign for the continuation of the up-move. Furthermore all the important technical indicators are positive now with buy mode and huge positive divergence but in slight overbought zone, so all together chart setup & indicators are giving positive signals, therefore it is likely to extend the on-going up-move further provided it holds the key points as mentioned above. The long term uptrend is intact now.

POSSIBLE MOVE ON THE UPSIDE:-

Please note that if it holds 24371---24337.86-----24193.85---24140---24131 on the closing basis then it can extend the up-move and moving up it will face very strong resistance at 24538—24694.35 & 24753.15.  if it moves above 24753.15 and sustain on the closing basis then it is likely that it will strongly extend the up-move and may get back into the strong up-momentum track again.

POSSIBLE MOVE ON THE DOWNSIDE:-

Moving down from here it may find good support at 24371---24337.86-----24193.85---24140---24131.10---24097----23974.50----23893.70----23768-----23696----23651----23572------23531------23458-----23350.15-----23338.70---23263.15------23110.80---22794.70----22775---22281---22165(few figures may change daily). Please note that it can bounce back from any of these points, break & sustained close below 24371 will threaten the long term uptrend again, break & sustained close below 24337.86 & 24193.85 will push it into short & deep correction mode for its recent rise, break & sustained close below 24131.10 will be an alert sign for the long trade, break & sustained close below 23974.50 will end the possibility of continuing the up-move, break & sustained close below 23893.70 will push it back into big correction mode if it sustains below it for a longer period of time then the correction could be more painful price-wise and time-wise both. Thereafter break & close below each point will weaken it further and finally moving down its last strong support range could be in the range of 23587---23472(figure will change daily) and then 23350---23263(figure will change daily), break & sustained close below the range of 23587---23472 may trigger fresh fall and break & sustained close below the range of 23350---23263 may accelerate the fall and may seek much lower levels.

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 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.

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,

STRENGTH: -

1. It is in the long-term uptrend.

2. It is far-far above its most critical points of 21821.05---21801.45---21777.65---21776.87---21731.40---21727.75 & 21710.20, which is must to keep the up momentum going in the year 2024. Sustained break below this range may witness accelerated fall.

3. Six out of seven important technical indicators are positive on the daily chart, the buy mode is on, huge positive divergence is there but in overbought zone, so it may correct for a while and then may resume the up-move.

4. It is almost above all its short term moving averages on the daily chart and the important average range for the day is between 24371----24244----24161----24121----24041----24007---23992 (figure will change every day), sustained close above this range can help it to extend the up-move.

5. It is above its strong pullback threshold point of 23974.50(figure may change).

6. It is above its correction threshold point of 24193.85 for its recent rise.

7. It is above its key point of 24131.10 which is essential to keep the up-momentum going in the month of December-2024.

8. The price action was positive today.

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

WEAKNESS: -.

1. Please note that almost all indicators on the weekly chart are  negative indicates oversold condition, sell mode and negative divergence and finally on the monthly chart it indicates overbought condition and negative divergence.    

2. 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.

3. It is into correction deep mode now as it closed below some of the correction threshold points of 26043.29----25917.64---25714.81----25106.68----25098.32-----25064.27-----24521.63--- (figures may change). The other important correction threshold points are at --24367.34----24097----24047.39---- 23659.18--- 21848.52 (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 24380----24355 with a stop loss of 24270 for a possible intraday gain, else avoid.

2. Short trade can be tried on the rise near or within the range of 24650—24700 with a stop loss of 24780 or can sell if it moves below 24280 and maintain for some time with a stop loss of 24380.  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

Mobile—8240951127/9831313654.

Email--- suranank@gmail.com