YES Bank stock rebounds 61% in two months; is it a value buy or momentum trap?

Shares of private sector lender YES Bank Ltd have risen 61% nearly two months. The banking stock, which hit a 52 week low of Rs 14.10 on October 23, 2023, ended at Rs 22.78 in the last session, delivering 61.56% gains in two months. YES Bank shares hit a 52 week high of Rs 23 on Monday against the previous close of Rs 21.93 on BSE. Later, they ended 3.88% higher at Rs 22.78.

YES Bank stock has gained 7.45 per cent in a year and risen 5.22 per cent in 2023. Market cap of the bank rose to Rs 65,514 crore in Monday’s trading session. YES Bank has a one-year beta of 0.5, indicating low volatility during the period.

In terms of technicals, the relative strength index (RSI) of the YES Bank stock stands at 78.5, signaling the stock is trading in the overbought zone. YES Bank shares are trading higher than the 5 day, 10 day, 20 day, 50 day, 100 day, 150 day and 200 day moving averages.

In three months, the stock has surged 22.74%.

Also read: YES Bank shares hit 52-week high, overbought on charts; what’s next?

With the stock surging 61% from its 52 week low  in two months, investors are guessing if the stock is a value buy or a momentum trap.

Shiju Koothupalakkal - Technical Research Analyst, Prabhudas Lilladher said, “YES Bank has recently picked up well from the bottom made near Rs 15.70 zone and recently has indicated a higher bottom formation pattern on the daily chart taking support near Rs 19-zone and with a decent pullback has given a breakout above Rs 21.20 zone with decent volume participation witnessed, to improve the bias and sentiment.”

"Further ahead, the next target visible would be near Rs 24.75 zone of the previous peak level and with major support maintained near Rs 19 levels, one can carry on with the long position," he added.

Jigar S Patel, Senior Manager - Technical Research, Anand Rathi Shares and Stock Brokers said, “Since the last month, YES Bank has gained some quick momentum and placed near the Rs 20 mark. Recently, it took out its previous swing with huge volume and successfully sustained above it. On the indicator front, daily DMI and RSI are hinting at a bullish bias in the counter. Thus, one can buy in the range of Rs 20–21 for a target of Rs 26 and a stop-loss of Rs 18 on a daily close basis.”

Disclaimer: Business Today provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.

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