Bank Nifty after being a major drag since topping out in February has finally broken out of a triangle consolidation.
Bank Nifty Triangle Breakout
- A big breakout move and then a 3 session pause.
- Retest of the breakout done.
- A big breakout move on Friday which takes it above recent swing highs.
- Stoploss at low of Friday.
- Ideally should not break Friday lows if the breakout is strong.
- Can head up towards 36500-37500
The Big Shift of Leadership
The more interesting part is the shift in leadership from the earlier leaders – HDFC Bank & Kotak Bank
A similar shift played out in 2019 when ICICI Bank took leadership. Even though it was a consensus trade it worked really well.
We take a look at Stock/Bank Nifty to look at leadership.
The first part of the recovery in 2020 saw clear leadership from HDFC Bank & Kotak Bank.
This seems to be shifting now.
HDFC Bank – Underperforming for past many months.
Kotak Bank – Not even able to cross the recent swing highs. Can be a bounce trade but not leadership.
The New Leaders for coming months and years also possibly.
What we imply by leadership is that – Whenever the Bank nifty rallies big way going forward we will see outperformance by these leaders.
ICICI Bank – In line with bank Nifty in the 2020 rally. Now taking leadership with Ratio Chart at new highs.
SBI – A leader after 10 years ?
We did see the stock leadership in February and then inline with Bank Nifty. Again taking leadership.
Also the stock has been an underperformer for 10 + years.
Axis Bank – Inline all through.
With the Suuti sale done can it catch momentum and take leadership?
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