A TECHNICAL UPDATE ON CNX-NIFTY-5.2.2025

 

CNX-NIFTY

Open—23509.90—High—23762.75---Low---23423.15--Close---23739.25 on 4.2.2025.

Support:23667.20/23664/23644.80/23637.65/23537/23484.15/23426.30/23391.65/23338.70/23263.15/23110.80/23047.25/22976.85/22794.70/22775.70/22525.65/22303.80/21875.25/21860.25/21821.05/21777.65/21710.20/21530.20/21281.45/21137.20/20976.80.

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 with an up-gap and thereafter had both side moves during the day and finally ended the day with a handsome gain of 378.20 points. 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 down to 23381, 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 and technical parameters on the daily chart has improved as it closed above its few key points of 23644.80---23637.65----23611----23532.45----23502(some figure may change) ,if it sustain above these points the ongoing up-move can extend further, but break & sustained close below 23644.80---23637.65----23619---23611 will weaken the chances of up-move in the year 2025, break & sustained close below 25532.45 will push it into correction mode for its recent rise and break & sustained close below  23502 may potentially end the on-going up-move , however moving down further if it manages to hold the range of 23379----23253(figures will change every day) on the closing basis then it could still bounce back but it may resume the good up move once it moves above 23644.80 and sustain, but break & sustained close below the range of 23379----23253 may end the up-move for sure and it may start to drift down. The short-term bias seems up now, but medium-term trend is still down and the long-term uptrend is still threatened and in jeopardy now. The short term bias is up.

Similarly moving up the key resistance points would be at 23746----23893.70----23898----24021-----24060----24146----24179---24313(figures will change daily). Please note that, if it move above 23893.70 and sustain on the closing basis then it will get a good foothold to build the strong up-move and then the up move is likely to extend further and if it moves above the range of 24146----24179---24313 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 to get good strength for the continuation of the up-move and to get into strong up-momentum track it has to move above 24481.42---24625.43---24753.15---24857.75 & 25078.30 (figure may change) particularly above 24753.15 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 partly negated if it moves above 23893.70 and will be fully  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 it.

TECHNICAL INDICATORS PLACEMENT ON THE DAILY CHART;-

It is making higher top & bottom on the line & bar chart and  it is above all its short term moving averages on the daily chart, above few averages on the weekly & monthly chart also, also above few medium term moving averages on the daily & weekly chart and also above few long term moving average also which is a positive  sign for the continuation of the up move, , but it is still below few averages on the weekly & below few on the monthly chart also, it is below few of its medium term moving average on the daily chart & below few averages on the weekly chart too and most importantly it is below almost  all its long term moving average on the daily chart, which is still a severe threat to the long term uptrend and it is highly  concerning and jeopardized the long term uptrend. But five out of seven important technical indicators are positive now and four indicators are in buy mode and huge positive divergence in one, but inching towards overbought zone in two  indicator, therefore, in totality it can the up-move  may be with-in-between down move. Please keep an eye on the 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 but it is in the oversold zone and may stage a recovery but that may not last. On the monthly chart it is in overbought zone and with huge negative divergence and MACD has triggered sell. 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 BUY ON DECLINE MARKET AS OF NOW;-

It is into deep correction mode for its earlier & recent rise, but pullback mode is on therefore  buy on decline can be tried  at appropriate support point  with strict stop loss , similarly short trade  can also be tried  after reasonable  rise at appropriate resistance points  with strict stop losses for intraday corrective gains.

STRENGTH: -

1. It is above its very short, short, medium & long pullback threshold point of 22938---23127 ----23276 & 23611 (figure may change), sustained close it may help it to move-up further.

2. Five out of seven technical indicators are positive on the daily chart with buy signal in four and with huge positive divergence in one indicator.

3. It is making higher top & bottom on the line & bar chart.

4 It is above all its short-term moving averages now on the daily chart and the important average range for day is between 23379----23366----23365----23272---23258---23253(figure will change every day), sustained close above this range will help in extending the up-move.

5. It is 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.

6. The price action was positive today.

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----23659.18---23432.90 (figures may change). The other important correction threshold point is 21848.52 (figure may change) and if it sustain below these points correction will deepen.

4. It is in the overbought zone on the daily chart in two indicators.

5. It is still below almost all its long-term moving averages therefore severely threatened the uptrend.

TRADING CALL: --

1. Long trade can be tried on decline near or within the range of 23645---23611 with a stop loss of 23500 or can buy if it moves above 23765 and maintain for some time with a stop loss of 23690   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 24000----24060 with a stop loss of 24120. 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