Derivatives analyst Nandish Shah recommends selling Axis Bank futures

The analyst from HDFC Securities recommends selling Axis Bank October contract on rise with a stop loss at Rs 745, for a downside target of Rs 705.

Derivative Strategy

Recommendation on Axis Bank

Sell Axis Bank October future

CMP: Rs 718.5

Sell around: Rs 730

Stop Loss: Rs 745

Target: Rs 705

Lot Size: 1,200

Rationale:

• We have seen short build up in the Axis Bank futures, where price has fallen along with the sharp rise in the Open Interest during last few days.
   
• The stock price has given a bearish breakout from the upward sloping trendline, adjoining the lows of 23-June and 29-August 2022 on the daily chart. 
   
• The primary trend of the stock has turned negative as stock price closed below its 200 day EMA.
   
• The momentum oscillators like RSI (11) and MFI (10) are in falling mode and placed below 40 on the daily chart, Indicating strength in the current downtrend.

Disclaimer: Nandish Shah is Technical Research Analyst at HDFC Securities. He doesn't hold any position in the stock. Views are personal.