Bank Nifty 20th Nov 2015
Bank Nifty Minor Trend is oversold. Bank Nifty Major Trend is sideways. Bank Nifty has major support around 16400 spot Bank Nifty spot levels mentioned. Overall we see Bank Nifty now in a minor bullish cycle and we do not see any significant downside beyond 16400. It will be better to trade outperforming counters like sugar rather than focusing time and energy behind Banking Sector both Public Sector Banking and Private Sector Banking as balance sheets are still going to see severe problems going forward in terms of rising NPA’s and asset quality problems.
Axis Bank has short term support at 458 Nse spot levels mentioned and if 458 is taken out with volumes we could see havoc in this counter. The longer term structure is not looking good at all and since this is one of the consensus trade in the Indian Stock Market and most Mutual funds and HNi’s are having this counter on top of their exposure list we could see some real problems coming out from them shortly. Caution is advised in Axis Bank. Un till and unless Axis Bank does not move past 490 don’t even consider this stock for short term trading bounce also.
Yes Bank overall trend both minor trend and major trend are sideways as of now and it is best to skip this counter also. Due to the high beta nature of this stock we could see Yes Bank rising towards 770-800. As per our analysis we will see the share price facing significant resistance around 790-800 area Nse cash levels mentioned and if the share prices trades below 685 then get out if you are long in this stock. Even for the medium term do not hold till we do not see a bottom formation process at least.
Punjab National Bank also does not look too good and has resistance at 145 Nse spot levels mentioned. If the share price is stable above 147 then only consider buying the stock around supports or low risk entry points. Overall the share price is in a sideways consolidation mode as of now.
Icici Bank minor trend is up while major trend is down. We have in the past two post very clearly mentioned that the fee income which Icici Bank generates comes mostly or rather largely from retail segment and retail segment is steadily and surely moving to payment wallets and mobile wallets. This will definitely dent the retail earnings of the bank in short to medium term. Also there are some issues that could come to public domain in Jan 2016 w.r.t Bad loans and asset quality. Caution is advised here too. We once again reiterate avoid this sector and move to Sugar Sector that will make your portfolio look very neat. Avoid Banking stocks for now. Significant problems will give us much cheaper valuations to buy. No one in the history of stock markets has made significant money buying banking stocks at these valuations. Al though prices have corrected but valuations still don’t look good and forward outlook for the sector is not looking good at all.
Buy Renuka, Bajaj Hind and Eid Parry. Reiterate Avoid Banking.
Good Trading To You!