Axis Bank: Breaking free from a 25% upside potential amid market turbulence

In a landscape characterised by market corrections and profit booking, Axis Bank Ltd, a prominent player in the private banking sector, has made a resounding move, surging nearly 4.5% during the current week. The bank is now poised to break out of a continuation price pattern, with its stock primed to close above the breakout trendline level. 

Axis Bank Ltd is a financial institution providing comprehensive financial solutions to a diverse clientele that includes retail customers, small and medium enterprises, government entities, and corporate businesses. The bank operates through several segments, including Treasury, Retail Banking, Corporate or Wholesale Banking, and Other Banking Business, offering a wide range of banking services. 

From a technical standpoint, Axis Bank has been consolidating within a rising price range, fluctuating between Rs 998 and Rs 814. A meticulous analysis of price movements, connecting the peak points of the first week of January 2023 (at Rs 970) and the last week of August 2023 (at Rs 998) on the weekly chart, reveals the emergence of a rising breakout trendline, indicative of a continuation price pattern. 

The recent consolidation phase has been further fortified by a bullish golden crossover involving the 5-13-26 Daily Moving Averages (DMA), accompanied by the 14-day Relative Strength Index (RSI) residing around 69 in the bullish zone. Notably, the stock is currently trading above the trendline of the mentioned pattern, supported by the 5 Weekly Moving Average (WMA). To confirm the breakout, the stock must close above the breakout trendline level at Rs 1000 on a weekly basis. 

Remarkably, the stock reached a weekly peak of Rs 1024 in today’s trading session, displaying its resilience and fuelling investor confidence. With the breakout now in progress, the stock sets its sights on a potential target of approximately Rs 1250, signalling a potential gain of over 25% from the breakout point. 

For short-term traders and investors, careful monitoring of the stock is advised, given its consistent and impressive performance. The unfolding scenario presents an enticing opportunity for further upward momentum. 

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.