Bank Nifty was down by almost 2.4 per cent on Wednesday around 1:05 pm, trading at 24,175.80 with all heavyweights including HDFC Bank, ICICI Bank, Axis Bank and SBI trading in the negative territory. What should the investors do? Expert Nilesh Jain of Anand Rathi Securities has some useful suggestions. Know what he recommends!
Jain said that there has been some selling phenomenon in the Bank Nifty over the past few sessions. He said that this is a monthly expiry week with volatility in place.
The biggest event in the form of US elections is scheduled on 3 November that has increased volatility in the global markets. All these factors are playing now.
Going forward the volatility is likely to increase, he said. The Volatility Index (VIX) is 23 which is likely to shoot up to 30 in the near to immediate term. This will lead to a selling pressure in Bank Nifty and Nifty as well.
There is a possibility of a structural breakdown if VIX shoots up, he said adding that it is currently rangebound. He said that there is a strong support around 24,000.
Jain’s trading strategy:
Jain said that the investors should avoid trading in index heavy weights stocks as the selling pressure and profit booking will be more in these stocks. It is better to remain light in a volatile market, he said the mid-caps and small-caps could be an option to look at. There is a likelihood of correction in all these stocks from here, he further said.
HDFC Bank posted a strong QFY21 results. Axis Bank’s result will be declared today after market hours while ICICI Bank’s results will be announced on 31 October 2020. The results of these banks are likely to be on expected lines, he added.
The strategy is only for a near term more specifically till the US elections are over, he said.
SBI Share Price Today: SBI shares were trading at Rs 190.15, down by over 2.3 per cent.
ICICI Bank Share Price Today: ICICI Bank shares were trading at Rs 401.05, down by over 2 per cent.
HDFC Bank Share Price Today:The stock has seen a good rally and is now in a consolidation mode. Jain said that there could be some more correction before that. The structure remains positive on technical charts. The stock was trading at Rs 1209.45, down by 1.9 per cent around this time. The buying opportunity will be around Rs 1170, he said.
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Axis Bank Share Price Today: Axis Bank shares were trading at Rs 499.75, down by over 1.6 per cent.
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