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We recommend a sell in the stock of YES Bank from a short-term perspective. It is seen from the charts of the stock that after finding support at around Rs 240 on October 5, the stock bounced upwards and rallied sharply. However, it encountered significant intermediate-term resistance in the band between Rs 320 and Rs 330 in October.
On November 8, the stock fell two per cent, forming a bearish engulfing pattern, which is a short-term bearish reversal pattern. Moreover, the daily relative strength index is displaying negative divergence signalling trend reversal in the stock price. Daily price rate of change indicator and stochastic oscillators are also displaying negative divergence, supporting the trend reversal.
We notice that the daily volume has been declining over the past seven trading sessions. Considering the fact that the stock's daily indicators and oscillators are displaying negative divergence and the stock reversing down from significant resistance band, we are bearish on the stock from a short-term perspective. We expect the stock to decline until it reaches our price target of Rs 297 or Rs 288 in the upcoming trading sessions. Traders with short-term perspective can sell the stock with stop-loss at Rs 316.
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