KotakBank gearing up for a recovery
Updated
Kotak Bank has been taking a beating for last 3 months, and I think it's about time that it started attracting some big investments again. My view on this stock is bullish right now, and we can expect the move to realise in next 2-3 months, i.e. May 1(around the time of their next financial report).
Kotak is a fundamentally strong bank, that has generated consistent revenues and even better profit margins in last couple of years. It's a good value stock that has been neutralised since it last tried breaking through it's all time high price in October 2021. It has recently jumped back up from a pretty solid supply zone, and to my eyes, it's giving all the right signals for a bullish recovery.
Rationale:
* Strong rejection from the supply zone, at a much higher price than the last reversal.
* Price responding well to fib-levels, taking support at .786 retracement level.
* A sharp spike in long term RSI & ADX levels, slow Stochastic starting to rise
* Price forming a bullish Gartley pattern
Long Setup:
* CMP: ~1750
* Entry levels: Wait for retest, ideal entry should be around 1720, aggressive buyers can start accumulating already. Buyers may look to average their price until 1700.
* Stop Loss Levels: Low risk tolerance -> 1680-1660, High risk tolerance -> 1620
* Target Levels: 1800 - 1850, long range target 1900-2000(3 month horizon)
Potential upside: 15%
Potential downside: 7%
Kotak is a fundamentally strong bank, that has generated consistent revenues and even better profit margins in last couple of years. It's a good value stock that has been neutralised since it last tried breaking through it's all time high price in October 2021. It has recently jumped back up from a pretty solid supply zone, and to my eyes, it's giving all the right signals for a bullish recovery.
Rationale:
* Strong rejection from the supply zone, at a much higher price than the last reversal.
* Price responding well to fib-levels, taking support at .786 retracement level.
* A sharp spike in long term RSI & ADX levels, slow Stochastic starting to rise
* Price forming a bullish Gartley pattern
Long Setup:
* CMP: ~1750
* Entry levels: Wait for retest, ideal entry should be around 1720, aggressive buyers can start accumulating already. Buyers may look to average their price until 1700.
* Stop Loss Levels: Low risk tolerance -> 1680-1660, High risk tolerance -> 1620
* Target Levels: 1800 - 1850, long range target 1900-2000(3 month horizon)
Potential upside: 15%
Potential downside: 7%
Trade active
- As mentioned earlier, the price has retracted back to the demand zone, and seems to be taking support at the same fib-level(.786).- These are good levels to start taking positions, the risk to reward ratio is great right now(almost 1:4), but RSI is still cooling down so look to average your price.
- Recommendation is to break your position down into smaller trades, as the market has been quite volatile this week.
Trade active
- First target has been reached- Good time to book some profits
- Those looking to bigger, 1800 - 1840 is good range to buy more
Trade closed: target reached
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