Yes Bank share price traded near four-month lows on Tuesday as it extended its two-week downward trajectory. The stock has underperformed its peers in the Nifty Financial Services Index (NSE: CNXFINANCE), declining by 5.8 percent in September against the Index’s gain of 3.2 percent.
Yes Bank (NSE: YESBANK) share price traded at Rs 22.40 at the time of writing, down by 0.3 percent in the intraday session. At its current level, the stock is below the 20,50, 100 and 200 Exponential Moving Averag (EMA) marks, underlining a strong bearish momentum. Furthermore, the 20-EMA (RS 23.09) recently crossed below the 200-EMA (23.15).
In mid-September, Indian media reported that the Reserve Bank of India (RBI) had declined to approve the acquisition of 51 percent stake in Yes Bank by a foreign bank. The move triggered a prolonged decline in the Yes Bank share price that has led the stock to its current position. Delayed conclusion of the acquisition bid is likely to add pressure to the share price in the near term.
A key limiting factor to the Yes Bank share price recovery is its weak financial standing. It currently has a Price-to-Earnings (P/E) ratio of 46, highlighting its overvaluation. The Bank’s next earnings release will be on October 18, and investors will be looking for improved revenue performance to justify holding on to the stock.
Yes Bank share price faces resistance at the Rs 22.42 pivot mark, and the MACD momentum indicator signals a continuation of the downside. With the sellers in control, the first support could come at 22.40. However, a stronger downward momentum could breach that support and test 22.36.
On the upside, immediate resistance is seen at 22.45 if the price goes above the pivot mark. In addition, a prolonged control by the buyers could enable a break above that level to test 22.50. Meanwhile, the move would render the downside narrative invalid.
This post was last modified on Oct 01, 2024, 12:08 BST 12:08