Why Are Axis Bank Shares Falling After a Good Rise in December 2020?

The recent decline in Axis Bank shares is a topic of much discussion in the financial community. This article aims to provide a comprehensive analysis of the situation, backed by historical data and expert insights.

Price Movements in the Post-Pandemic Era

After the pandemic, many stocks have corrected to their fair values. Similarly, Axis Bank, following its rise in December 2020, has seen a slight correction.

According to historical charts, Axis Bank has encountered resistance levels at approximately 620 to 645. These levels, similar to those seen in July 2015, September 2016, and February 2018, mark critical points that have historically challenged the stock's upward trajectory. Recently, in December 2020, the stock has been attempting to breach these resistance levels. Once a break occurs, it could signal a bullish move up to around 820.

Provisions and Anticipation of Defaults

The recent decline in Axis Bank shares can also be attributed to the banks' provisions in anticipation of potential defaults. A significant amount was provisioned, indicating a higher probability of non-performing assets (NPA).

My view is that there is much uncertainty regarding how banks will manage their existing NPAs, moratoriums, and other issues. This highlights the increasing need for robust risk management strategies.

Source: Nitin Bhatia's Recent Tweet

Factors Impacting Share Prices

There are numerous factors that can lead to a decline in share prices, including:

In the case of Axis Bank, the stock recently reached its lifetime high around Rs 640 levels post a stock split in July 2014. This was a natural correction after hitting these targets, and more scrutiny indicates a simple correction. Traders can re-enter this market after a good correction.

Banking Sector Concerns

The decline in Axis Bank shares aligns with the broader trend in the banking sector, particularly due to concerns over asset quality. As PSU banks clear out their NPAs, concerns over the asset quality of these institutions may lead to further dips in stock prices.

FUTURE AXIS BANK Share Price Forecast

To stay well-informed, you can add Axis Bank to your watchlist to receive daily updates on support and resistance levels.

Levels for Today, 26 September 2016: Major Resistance R2614.20 Major Resistance R1595.90 Previous Days Close: 559.20 Major Support S1546.30 Major Support S2543.70

AXIS BANK NSE India: Major Resistance R2612.00 Major Resistance R1596.10 Previous Days Close: 557.45 Major Support S1540.85 Major Support S2535.45

For more insights, check out the article: Axis Bank Shares Fall 6% on SUUTI Stake Sale Buzz - The Economic Times.