Kotak Mahindra Bank (Ticker — KOTAKBANK)
The stock price is consolidating from July 2021 till the date within the price range of 1625–2000. While banknifty has gone up almost 50% stock hasn’t performed well.
Market Structure
On the weekly chart, the stock is completely sideways, there has been no return from the last 3 years. Price is continuously taking support near the 1625 level. So I have been building a position slowly within a 1600–1700 range. I am adding more aggressively near the 1600 level.
Moving Averages
On the weekly chart, the price is currently concentrated towards all moving averages of 20, 50, and 200MAs, an indication of a sideways price range.
On the daily chart, the price is currently trading below all MAs, which is not bullish so better to build a position slowly. 200MA on the day chart is around the 1800 level so once the price goes above it and sustains then only we can see some bullish momentum.
RSI (Relative Strength Index)
RSI on the weekly chart is taking support from the 40 levels again & again and failed to sustain above 60 and go above 70. Once RSI starts to sustain above 60 and goes above 70 we can see a good bullish momentum.
Fibonacci Levels
If you take Sep 2020 lows (Price 1230) to October 2021 highs (Price 2250) current price has retraced to 61.7% and trading around 1700. The good thing is the price is consolidating near the level and again taking support from the same level indication of accumulation here.
Point & Figure Chart
The P&F chart is bearish as of now. It will give a buy signal above 1800 after the breakout of the down trendline. So building position slowly is advisable. One can always add more once a breakout happens and a clear market structure is formed.
Fundamental Analysis
The PE Ratio of the stock is very decent, trading at a 5-year low.
Net profits of the company are growing every quarter, Reported highest ever quarterly net profits from last 2–3 quarters. So no issue with that.
Last year company reported the highest-ever net profit annually as well. From 2020 to 2023 net profits have almost doubled.
DIIs have increased their stacks to almost double from 2020 and FIIs have been maintaining the same. Good sign that big players are still holding into positions.
So overall fundamentally stock is very strong and technically price is consolidating within a range, so whenever you get a good opportunity near the support level, one should consider aggregating the stock. I am building my positions in the stock at a support level.
