It pays to follow technicals and when stock gives warning signs after warning signs, then don't ignore them.
ICICI Bank stock broke out above 250-255 in March 2015
ICICI Bank stock then by the end of 2014 rallied all the way up to 360. It was a cool 44% upmove - not bad for a large-cap stock. The breakout move made the stock a buy on declines.
The first warning sign: The stock failed to hold 200 dma
ICICI Bank stock ideally should have got the support at 200 dma but it seems bulls were not eager to buy the stock there. The stock started drifting sideways to down and a new structure started to form shape with 283 as solid support.
It was a textbook kind of support and I did mention about it in June-August 2015 period. Then came the next warning: ICICI Bank stock broke down below 283
ICICI Bank stock now is trading below every conceivable support. Now lots of time we ignore warning signs because we have ultimate faith in the stock. But as we say in markets - always keep your eyes open and never ignore the warning signs. ICICI Bank stock delivers this message very strongly.
Disclaimer – The state of the market notes is Deepak’s perspective on the market. The column is purely for educational purpose. Nothing contained herein is a solicitation to trade or a recommendation of a specific trade. By reading this publication you agree to make no trade relying in whole or in part on the comments of the writers