We have been slowly grinding around the 200 DMA for a while now, which is holding pretty well for some time now. There are strong supports around 5080 and 5020. The Earnings season has been fairly good, and the earnings for few key sectors like banks seems to have bottomed out, and their NPA profile also looks ok. Until somethings goes horribly wrong in Europe or China, we should hold these supports and should use the current dips to buy into stocks.
Axis Bank has been one of my favourites along with ICICI. The stock posted a good set up numbers today, PAT, NII, NIM and NPA profile was impressive, however the kind of correction the stock has seen call for a short covering rally, above its 200 DMA. I expect Axis to outperform next week and expect 1190-1200 in a week or two. A positional buy above 1110.
An example of a breakdown below the 200 DMA. One should have kept a stoploss marginally below the 200 DMA, and booked losses
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