Bank of India is going through it's sixth anniversary of being an anti-investor stock. But you do still hear Indian investors holding & enquiring about the stock. This is because there's a perception in the country's investors that banking stocks & banks in India are a safe bet. Though this is not entirely false in the historical context that banks & their deposits have been protected in the country. But from an investment point of view, this is simply similar to putting your money under a mattress or inside a shoe & forgetting about it, this generates no returns.
The stock has been on a down trend since 2011 & this can be easily spotted on the weekly chart below as illustrated. The stock did show a false trend (as marked in the chart below) during early 2014, while also indicating a failure in trend immediately hence any up move was set to be unstable & fail. But as with any falling stock it tickles an investors curiosity, as to when it will be an opportunity worthy of profiting from. The following are the supports & resistances on the stock (also marked in the daily chart above) : Resistances : 157, 140, 118, 107 Supports : 91 The stock has major resistances at 157 & 140, whereas immediate minor resistances at 118 & 107. As of now there seems to be no promising scenario of a price improvement in the stock. The charts show no base formation hence any sudden moves will result in a reversal soon. The supports for the stock are also weak, with a support at 91 which only offers short term respite. From an investor perspective the stock is in a large bear move languishing at it's prices of 2005 & also showing no signs so far of stopping. |
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NTPC Daily Candlestick Chart
Long-Term Supports & Resistances Chart
BHEL Daily Candlestick Chart
Long-Term Supports & Resistances Chart
Now sooner or later every market has to break this sideways range. I am not predicting a downward movement of the market yet but if we are going to see more significant upward moves in the future, Nifty has to correct a little else it will weaken.
You can refer to the chart above & notice that I have drawn four horizontals lines at different levels, in my opinion one has to watch these levels carefully to catch the short to medium term trends in this market. If the market keeps trading below the level of 8070, it will confirm that it intends to correct, but for that to happen it will also have to break below the levels of 7910 first. If it does this we can easily see the market heading towards levels of 7800 and 7700. Also on the chart above I have drawn a line at the price level of 7666, one has to be extra attentive at this level because if the market reaches somewhere around here it will bounce back very quickly and might aim for new highs as this is a very strong support. |
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