A TECHNICAL UPDATE ON CNX-NIFTY-8.1.2025

 

CNX-NIFTY

Open—23679.90—High—23795.20---Low---23637.80--Close-23707.90 on 7.1.2025.

Support:23667.20/23664/23644.80/23637.65/23537/23484.15/23350/23338.70/23263.15/23110.80/22794.70/22775.70/22525.65/22303.80/21875.25/21860.25/21821.05/21777.65/21710.20/21530.20/21281.45/21137.20/20976.80.

Resistance:23816.15/23873.35/23893.70/23938.85/24073.90/24094.20/24099.70/24141.80/24354.55/24472.80/24498.20/24537.60/24694.35/24753.15/24792.3024854.80/24857.75/25078.30/25234.05/25285.55/25333.65/25445.70/25871.35/26277.35/26328/26995/27095/27212/27293/27381.

OVERALL VIEW ON THE DAILY CHART: --   

It opened on a positive note and thereafter and had both side moves during the day and finally ended, the day with a gain of 91.85 points. It is often exhibiting volatility, which is not a good sign for a steady market.

It is already into deep corrective mode and the overall chart setup is weak. But the good thing is that it has bounced back above its benchmark points of 23644.80 & 23637.65 today which is an essential parameter to keep the hope alive of an up-move in the year 2025, and this is a positive sign, but break & sustained close below these points could drag it down faster. Moving down further from here last few critical support points are at 23582---23537---23460.45---23350---23263.15(few figures may change) and from any of these points it could bounce back, but sustained close below 23582 will put the long term uptrend in jeopardy and break & sustained close below the range of 23460.45---23350---23263.15 may witness an accelerated fall and then it will find the next strong support in the range of 22794.70----22768.40 and it is needless to mention here that break & sustained close below this range can drag it down to much lower levels, which may please be noted. The short & medium term trend is down and the long term uptrend is threatened. The bias is still negative as of now.

Similarly moving up the key resistance points would be at 23795----23829----23893.70----23974.50----24039----24205----24326---24460---24481.42(figures will change daily). Please note that if it moves above 23893.70 and sustain on the closing basis then it will get a foothold to build the up-move, if it moves above 23974.50 and sustain on the closing basis then the up move is likely to extend further and if it moves above the range of 24205----24326---24460---24481.42 and sustain on the closing basis then the long term uptrend threat will dissipate and it may somewhat ensure that up-move can extend further for sure. But it may get good strength for the continuation of the up-move and may get into strong up-momentum track only if it moves above 24625.43---24753.15---24857.75 & 25078.30 (figure may change) and sustain on the closing basis.

HEAD & SHOULDER PATTERN VISIBLE ON THE DAILY CHART:-It is decisively below its neckline which is placed at 23893.70 and if it sustain below it on the closing basis then the maximum downside target could be in the range of 21850---21510. Please note that this pattern will be negated if it moves above 24857.75 & 25078.35. This is a very powerful pattern and rarely fails. It is therefore suggested that do not remain short if it closes above the neckline of 23893.70 and sustain, similarly do not remain long if it closes below 23893.70.

TECHNICAL INDICATORS PLACEMENT ON THE DAILY CHART;-

It has broken its recent bottom on the line chart, it is below all its short term moving average on the daily, & weekly chart and below some average on the monthly chart also, it is below all its medium term moving average on the daily chart and below few on the weekly chart and most importantly it is below almost all of its long term moving average on the daily chart which is a severe threat to the long term uptrend and this is highly concerning. Furthermore all the important technical indicators are negative on the daily chart and maximum indicators are in the sell mode but the comforting thing is that it has positive divergence and in the oversold zone, so today’s up-move can last one or two days more, but looking at overall chart setup this up-move is not likely to sustain and may fizzle out soon.  It is also important to mention here that the price action is consistently weak for some time. Therefore in totality further fall is very much on the card in the coming days. So watch out and keep an eye on price action for further directional indication.

 TECHNICAL INDICATORS PLACEMENT ON THE WEEKLY & MONTHLY CHART:-

On the weekly chart almost all indicators are negative, sell mode is on in the maximum indicators, there is huge negative divergence and it is in the oversold/ neutral 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 the down move is on. So keep a watch on the price action for further directional indication.

IT IS SELL ON RISE MARKET NOW;-

It is into deep correction mode for its earlier & recent rise, therefore it is sell on the rise market now till it closes at least above 23644.80 and sustain, but still long trade can also be tried on decline near the critical support points with strict stop losses for intraday gains.

STRENGTH: -

1. It is in the long-term uptrend, but it has been severely threatened.

2. It is still holding its key support points of 23644.80--23637.65---23582----23460.45---23350---23263.15.

3. Its above its most critical points of  23644.80 & 23637.65; please note that it must stay above these points to keep up the up momentum going in the year 2025.

WEAKNESS: -.

1. Please note that almost all indicators on the weekly chart are negative indicates oversold condition, sell mode is on 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----25098.32-----25064.27-----24625.43-----24521.63--- 24481.42-----24047.39(figures may change). The other important correction threshold point is 23659.18----21848.52 (figure may change) and if it sustain below these points correction will deepen.

4. All the seven important technical indicators are negative, maximum indicators on the sell mode now, negative divergence is there but in oversold zone, so it may give a relief rally any time and then may resume down move again.

5. It is below its deep correction threshold point of 24481.42 for its recent rise.

6 It is below all its short-term moving averages now on the daily chart and the important average range for day is between 24143----24046----24023----23954---23877----23839---23799----23785(figure will change every day), sustained close below this range can witness an accelerated down move.

7. It is below its strong pullback threshold point of 23974.50(figure may change).

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

9. The price action was mixed today.

TRADING CALL: --

1. Long trade can be tried on decline near or within the range of 23645----23600 with a stop loss of 23530 or if it sustain above 23708 for some time then with a stop loss of 23630 for a possible intraday gain, else avoid. Please note that long trade in a corrective market could be a risky affair but can be tried near critical support points for intraday gains.  

2. Short trade can be tried on the rise near or within the range of 23890—23940 with a stop loss of 24050 or sell if it moves below 23600 and maintain for some time with a stop loss of 23670. 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