AU Small Finance Bank (₹565.75)
At a range bottom
The stock of AU Small Finance Bank has been rallying for nearly two weeks. It bounced off a support at ₹500 and it formed a bullish pin bar candlestick, hinting at a potential reversal in trend. Note that the price band of ₹470-500 is a considerable support band, which has been holding true since May 2021. So, this is a strong base.
Given these factors, there is a good chance that the stock will rally from the current level, possibly to ₹730. Therefore, traders can go long on AU Small Finance Bank at ₹565 and accumulate at ₹530. Place stop-loss at ₹460. When the stock rises to ₹640, revise the stop-loss to ₹540. Move the stop-loss to ₹650 when the price hits ₹700. Exit at ₹730.
Axis Bank (₹1,015.85)
Rally likely to be capped
Axis Bank’s stock has been in a downtrend since July last year. The resistance at ₹1,325 triggered a decline. Though, over the past few weeks, the stock has seen some recovery. It found support at ₹940 last month and recovered. The scrip closed at ₹1,015.85 last week. However, this upswing can be capped at the current level as ₹1,030-1,050 is a strong resistance band.
On the back of this, we expect the stock to resume the fall wherein the price can drop to ₹900 in the short-term. So, go short on Axis Bank at ₹1,020 and ₹1,040. Place a stop-loss at ₹1,070. When the price drops to ₹950, modify the stop-loss to ₹1,000. Trail the stop-loss to ₹960 when the stock touches ₹925. Exit at ₹900.
Cholamandalam Investment and Finance Company (₹1,400.45)
Surpasses a key resistance
The stock of Cholamandalam Investment and Finance Company has been appreciating since the final week of January after finding support at ₹1,180. In early February, it surpassed a resistance at ₹1,350, potentially turning the trend upside. Over the past month the scrip has formed an ascending triangle, which confirmed last week.
So, the probability of a rally from the current level is high. The chart shows a potential for an upside to ₹1,640. Participants can buy this stock at ₹1,400 and accumulate at ₹1,370. Place stop-loss at ₹1,300. When the price hits ₹1,520, alter the stop-loss to ₹1,400. On a rally to ₹1,600, revise the stop-loss to ₹1,500. Liquidate the longs at ₹1,640.