Short term traders can look to buy the stock now as the momentum is likely to continue which could take the stock to fresh 52-week highs of 240-280 levels, suggest experts.
The private sector bank rose from Rs 113.75 as of 30 September 2022 to Rs 252 recorded on 29th September 2023 which translates into an upside of over 120% in a year.
The momentum helped the stock to hit a fresh 52-week high of Rs 255.95 on 29 September 2023. The stock rallied more than 40% in the last 3 months and over 8% in a week.
The stock has been in an uptrend after it made a short-term bottom above the 50-week moving average on the weekly charts above 130 levels.
The stock also gave a breakout from a bullish Pennant pattern on the weekly charts which has opened room for the stock to head higher.
Pennant is similar to a symmetrical triangle, with a few differences. The time taken for completing the formation of a symmetrical triangle is usually 1-3 months, a pennant formation is completed in a much smaller time frame, say 10-15 days. Also Read https://economictimes.indiatimes.com/markets/stocks/news/pennant-and-wedges/articleshow/70797785.cms?from=mdrIn terms of price action, the stock is trading well above most of the short- and long-term moving averages such as 5,10,30,50,100, and 200-DMA on the daily charts.
The daily Relative Strength Index (RSI) is at 66.7. RSI below 30 is oversold and above 70 is considered overbought. The daily MACD is above its center and signal Line, this is a bullish indicator.
“RBL Bank’s stock stands out with notable strength against its counterparts and has recently registered a breakout in ratio charts when compared to the benchmark index, BANKNIFTY,” Omkar Patil, Technical Research Associate at GEPL Capital, said.
“From June 2021, RBL Bank has been on a promising upward path, consistently forming higher highs and higher lows. A recent surge through the Bullish Pennant pattern further solidifies its bullish stance,” he said.
“Moreover, the RSI on the weekly chart is trending upwards, maintaining a robust position above the 60 thresholds, indicative of strong positive momentum in the stock,” highlights Patil.
“Going ahead we expect the prices to move higher till 285 level where the stop loss must be 240 strictly on the closing basis,” he recommends.
(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of the Economic Times)