The stock hit a record high of 228.90 on 23 January 2015 but it failed to hold on to the momentum and witnessed a steep fall which took the stock towards 26 in May 2020.
The stock witnessed a V-shaped recovery after hitting a low in May 2020. The stock rallied more than 13% in a month and over 50% in a year.
The PSU bank surpassed multi-year critical resistance of 200 in July 2023 but witnessed selling pressure soon after. However, it managed to surpass 200 in September and is sustaining above the same, which is a bullish sign.
In terms of price action, the stock is trading well above most of the crucial short- and long-term moving averages on the daily charts, which is a positive sign for the bulls.
The daily Relative Strength Index (RSI) is at 64.7. RSI below 30 is oversold and above 70 is considered overbought, Trendlyne data showed. The daily MACD is above its center and signal Line, this is a bullish indicator.
“Bank of Baroda stock underwent a V-shaped recovery, masking a sizable decline with an even larger surge. The stock has also crossed over a downward-sloping trendline on a longer time scale,” Suraj Bathija, Founder & CSO at AlgoBulls, said.The fact that the daily, weekly, and monthly RSI are all trading above the 60 level indicates that the trend and momentum are both moving upward.
“The fact that the stock has been retracing 50% of its advance suggests that it is rising gradually and most likely will keep doing so. The weekly and monthly RSI have never fallen below 40 since November 2020, when it first started to trend downward,” he said.
“We can infer that the buyers are more powerful than the sellers because the volumes of green candles are, on average, higher than those of red candles. The stock’s Net NPA has also decreased in 2023, a sign that the company’s finances are strengthening,” highlights Bathija.
“Earnings per share (EPS), a metric for gauging a company’s profitability, rose from 15.18 in 2022 to 28.80 in 2023. The aforementioned stock has generated returns over the last year that are comparable to the benchmark of CNX PSU Banks,” he added.
“The stock, which is currently trading above Rs 200, is most likely to surpass its all-time high of 229 and rise to 275 in the upcoming three to four months,” recommends Bathija.
(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)