Bank Nifty 18th Jan 2016
Bank Nifty Minor Trend is oversold. Bank Nifty Major Trend is down. I do know many traders who are stuck in Bank Nifty Futures / Individual Bank Nifty constituent stocks like Axis Bank, Icici Bank, Punjab National Bank, State Bank of India, Bank of India, Canara Bank, Yes Bank and many other Banking stocks (I do not want to waste time by mentioning more names but this is what we have been mentioning since past so many days) Once again I am giving out clear view on Indian Banking sector. This sector is going through massive turmoil in terms of NPA’s, asset quality issues and we do not see that changing in the short term, in fact people or most analyst are not even calculating the impact payment wallets will be having on retail fee income for these banks and in this segment the number one looser will be Icici Bank and Axis Bank Their retail fee incomes are going to go for a toss in the coming months so please watch out for big problems on the Net income front for these banks and we have been recommending since last 6-9 months to totally avoid this sector for investments or even trading. Longs positions can be taken in stocks making higher top and higher bottom formation not in stocks whose structures are collaring and every pullback keeps failing. Anyways forget it. Since many people are stuck in it we are here to suggest a possible way out. (Please take my advise with a pinch of salt I am not God and I may go wrong so please understand my intention is to help and assist you and provide our overall view on the Bank Nifty / Bank Nifty Futures )
Bank Nifty has a very important support zone between 14150-14500 Bank Nifty spot levels mentioned. We expect this range to hold in the short to medium term but we do not advise buying into Bank Nifty / Bank Nifty futures components so if you are stuck in positions please average lower around this range and then exit higher. This is not a sector you should be in for long trades, just because a stock has fallen from 650 to 378 does not make it cheap. The problems in this sector are so huge and enormous that it is not possible for any human to calculate the impact of trend changing technologies. So on rise please get out of this sector and switch out / buy into to sugar stocks like Bajaj Hindustan, EID Parry and Renuka Sugar.
Time cycle wise we should see a bottom for Bank Nifty this week. We will be trading more on the Nifty Futures / Nifty options front. Next 3-4 trading days will be extremely volatile and please be careful.
Good Trading To You!