Is the bullishness still intact in HDFC Bank?

HDFC Bank last week made an all-time high and closed at Rs 1,687. Recently they came out with their quarterly numbers. For the quarter ended September 2021, HDFC Bank reported a profit of Rs 8,834.31 crore which is 17.6 per cent higher when compared to the corresponding period in the last fiscal on a standalone basis. This is mainly due to the marginal increase in provisions and higher other income. Sequentially, the profit growth stood at 14.3 per cent, whereas on a YoY basis, its Net Interest Income (NII), increased by 12.1 per cent.

Looking at the technical side of the stock, on the weekly charts, it formed an ascending triangle chart pattern. This is can be seen in the below chart.

The ascending triangle is in a bullish continuation pattern. It forms when the price creates higher lows, whereas the resistance remains intact. This shows that bulls are more aggressive than bears. This is confirmed when the price breaks out of the formed triangle.

On the plotted Fibonacci extension, it has breached the level of 1.618 which indicated further bullishness in the stock. However, from current levels, we might witness a pullback.

Other technical indicators such as Relative Strength Index (RSI) and Moving Average Convergence and Divergence (MACD), it is sounding bullish. However, when we look at Bollinger bands, it does indicate a possible pullback from the current levels.

Having said that, with such good quarterly numbers posted, supportive technical indicators and price action, investing in this stock does sound promising. Traders are advised to adhere to strict stop loss and should trade on pullbacks.

HDFC Bank’s stock today opened at Rs 1,705, made a high of Rs 1,725 and a low of Rs 1,672. At the time of writing the stock was trading at Rs 1,678.