Axis Bank, BoB, HDFC Bank, ICICI Bank: Banking stocks that look oversold

A continuous correction with negative close, rise in volumes and Relative Strength Index (RSI) help in identifying stocks that are in oversold territory. Although such stocks may not always show reversals but short-term rebound cannot be ruled out.

Stocks witnessing negative close for nearly five sessions have seen rebound that may see buying strength if price manages to cross significant resistances going ahead. Amid this formation, if the stock shows closing near previous close, then the rebound seems to be in a consolidation phase.

Volumes play a crucial role in pushing prices to the right direction strongly. Whenever a stock witnesses higher volumes, which is normally stronger than earlier candles, it indicates severe pressure. As the stock trades and move upward without breaching earlier lows, one may be optimistic about the counter for immediate positive trades.

Relative Strength Index (RSI) is a momentum indicator that indicates stocks trading in overbought and oversold territories. RSI is measured at 0-100 scale with stocks trading below 30 value is considered as oversold and stock trading above 100 as overbought.

Here is the list of stocks from banking sector that look oversold -