Technical check on State Bank of India before earnings

India’s largest public sector bank, State Bank of India will report its Q1FY21 result today. Here is a sneak-peek to the stock’s technical position.

Technically, the stock has formed an Inside bar and NR7 pattern as on May 26, 2020, and thereafter, witnessed almost 35 per cent pullback rally. The pullback is halted in between 23.6 per cent to 38.2 per cent retracement level of its prior downward move (Rs 331.30-Rs 149.45) and coincides with the 20-week EMA level. After registering a high of Rs 202.50 as of July 10, 2020, the stock has witnessed a consolidation. As the stock is trading in a narrow range since the last 14 trading sessions, Bollinger Bands have contracted, which indicates an early sign of a bigger move.

Majorly, the stock is displaying a bearish trend as it is trading below its weekly pivot and long-term moving averages, that is, 100-day EMA, and 200-day EMA. Among the momentum indicators, the daily RSI hovers in a neutral region without any bias. Further, the ADX is also below 15 and this clearly indicates the lack of a clear trend. Other indicators are also mirroring the same image.

Talking purely about the trading levels, the zone of Rs 185-Rs 181 level is a crucial support area and the level of Rs 196-Rs 200 is a resistance zone. A sustainable move on either side would lead to a trending move.