Yes Bank Share Price Nosedives As Widespread Market Volatility Favours the Sellers

Summary:
• The Indian stock market has seen volatility go above 21% for the first time since mid-2022, and the Yes Bank share price is following cues.

Yes Bank share’s steep decline continue on Monday as they traded at Rs 22.15, down by 2.5 percent in the intraday session.  There’s little doubt that the momentum on the share price has turned bearish, after five consecutive days in the red. The overall decline is more widespread, however, going back two weeks. Yes Bank lost 10% in the last week, but the opportunity to buy low is certainly not yet here, as there seems to be room for further lows.

The recent days have been characterized by significant changes to the holding of Yes Bank shares by institutional investor. Also, it is notable that the current decline traces back to the earnings release, when the bank beat forecasts in its profit and revenue targets.  The bank reported a 123% increase in profits for the quarter ended March 31 2024, equivalent to Rs 452 crore. Therefore, what we are currently seeing is likely a result of profit taking, as many analysts maintain a “sell” position on it.

Overall, there is an element of anxiety in the Indian stock markets as the elections head to the homestretch.  As of this writing, the Indian Volatility Index was at 20.4%, near the highest level since October 2024, signaling a potential uptick in volatility in the coming days. While the ruling BJP is forecast to win the elections, the low voter turnout has injected an element of uncertainty over an outright win by the party.  With the elections still having more than 2 weeks to go, the selling pressure on Yes Bank is likely to follow the overall market cue.

Technical analysis

The Yes Bank share price is currently experiencing a bearish momentum, with the daily RSI at 34. The downside will likely prevail if resistance persists at 22.50. That will favour the sellers to be in control, with the first support coming at 22.05. A continuation of that control will likely breach the support, and build the momentum to move further down to test 21.80. However, if the buyers push back the share price above 22.50, they will likely be in control, with the next resistance at 22.85 in sight. An extension of that support will likely break above the resistance, thus invalidating the downside view. In addition, the momentum could propel further upside gains to test 23.05.