Technical Analysis (TA) is a mechanical trading technique for identifying and forecasting the stock price depending upon the historical data. It does not indicate the exact future price of stock but forecast the trend and momentum of a stock price. We have taken Axis Bank, HDFC Bank, ICICI Bank and State Bank of India for conducting our study. These four banks constituted 79% shares of Bank Nifty. These sample companies are selected on the basis of their market capitalization in banking sector and largest customer dealing network.
Present paper actually is a comparative study of 'buy and hold' strategy with strategy suggested by TA. We have applied Moving Average (MA) and its improvisations as TA trading tool for conducting the study. Data have been collected from secondary sources for the period of four months starting from 2nd September, 2013 to 31th December, 2013.
Our investigation shows that TA is not always profitable in the entire market segment and in all the time horizons.
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