Archive for the 'Technical Analysis' Category

03
Jul
11

SBI Fibonacci retracement

SBI had announced disastrous Q4 FY10 results on May 17,2011 (http://www.moneycontrol.com/news/results/sbi-q4-pat-dipshigher-provisions_544131.html). SBI share price fell from Rs. 2620-2625 odd level to low of Rs. 2120 in June. This whole fall was closer to 500 points. On Friday, SBI share price closed at 2406.

On Fibonacci retracement (http://www.investopedia.com/terms/f/fibonacciretracement.asp), 61.9% of this fall is closer to 2429. In this zone around 2430-2440, SBI should face some resistance before moving up. 50 day simple moving average for Indian banking giant is also around 2413. SBI already had decent move from lows of 2120 levels, I expect it to spend some time in this resistance zone. Fundamentally also, SBI should not move much higher from these levels in a hurry, given some more provisions are expected in Q1 FY11 results. In case SBI rises some more from here I will write 2700 OTM calls. As if now I have written 2600 calls.

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