Chartist Talk: Nifty’s 24,950 support at risk amid fresh US-China trade tensions, warns SBI Securities' Sudeep Shah

The Bank Nifty index continued to assert its leadership last week, advancing nearly 2 percent and extending its streak of outperformance. A key highlight was the breakout from a Symmetrical Triangle pattern on the daily chart — a bullish signal that points toward the possibility of further upside momentum.

The strength in Bank Nifty isn’t limited to price action alone; it’s also evident in its relative performance. The ratio chart of Bank Nifty versus Nifty shows a clear formation of higher highs and higher lows, indicating that banking stocks are gaining traction faster than the broader market. While the Nifty still trades about 3.77 percent below its lifetime high, Bank Nifty is just 1.76 percent away — a testament to its relative resilience and dominance.

Notably, the rally has been well-spread across the banking universe. Technically, the setup remains solid. The index is comfortably positioned above key short- and long-term moving averages, reflecting sustained bullish momentum. Moreover, the daily RSI has bounced smartly after finding support near the 60 level, signaling a transition from a neutral phase to a strong bullish zone — further confirming improving momentum.

With both price structure and relative strength favouring the bulls, Bank Nifty looks poised to retest its record highs soon. In the near term, the index could head toward 57,200 and subsequently 58,000 levels, while the 56,000–55,900 zone is likely to serve as a crucial support area.

Will the Nifty 50 be able to hold the 25,000–24,900 support zone next week, even though sentiment has turned positive, mainly supported by banking stocks?

It feels like Diwali has arrived early on Dalal Street, with Indian equities already glowing in festive spirits. The benchmark Nifty 50 has been on a strong upward march since the start of October, posting a month-to-date gain of 2.74 percent — a move that perfectly captures the buoyant mood of the season.

That said, investors may need to remain cautious, as fresh headlines on the US–China tariff tussle surfaced on Friday night, which could sway global sentiment in the days ahead.

Looking back at last week’s action, the Nifty Private Bank Index stole the spotlight with an impressive rally of nearly 5 percent so far this month. The banking space has clearly taken control, lending both direction and confidence to the broader market.

Adding further shine to the market momentum was the comeback in the Midcap segment. The Nifty Midcap 100 surged over 2 percent last week and now sits right at the verge of a Symmetrical Triangle breakout on the daily chart — a technical formation often preceding a decisive move. This suggests that the rally is now widening, with participation extending beyond just large-cap names.

As for the Nifty itself, the index is hovering near a crucial breakout point above a downward-sloping trendline connecting swing highs since June 2025. The overall structure remains bullish, with prices holding comfortably above all major moving averages, each of which is now turning higher — a strong sign of sustained momentum. The daily RSI has also crossed the 60 mark and continues to climb, underscoring growing buying strength.

With the festival of lights around the corner, optimism is clearly lighting up the markets too. However, given the global cues, traders should closely watch the 25,350–25,400 zone, which serves as an immediate resistance aligned with the trendline. A decisive move above 25,400 could open the doors for a rally towards 25,700–25,800 levels. On the flip side, support is placed around 24,980–24,950. A sustained breach below 24,950 may trigger further downside towards 24,700.

While the undertone remains positive, investors should keep an eye on global developments, as renewed tariff tensions between the US and China could inject short-term volatility into the otherwise festive rally.

Which two stocks are on your radar for the upcoming week?

Larsen & Toubro

The stock has delivered a decisive breakout above the crucial Rs 3,730–3,750 resistance zone, which had capped gains on multiple occasions earlier. Post the breakout, the stock is trending steadily along the upper Bollinger Band — a sign of strong bullish momentum and sustained buying interest. The short- and medium-term moving averages are positively aligned, reinforcing the ongoing uptrend.

The ADX is maintaining healthy levels, confirming trend strength rather than exhaustion. Overall, the breakout backed by firm volume and supportive indicators suggests that L&T may continue to see follow-through buying in the sessions ahead. Hence, we recommend accumulating the stock in the zone of Rs 3,790-3,770 with a stop-loss of Rs 3,665. On the upside, it is likely to test the level of Rs 4,050 in the short term.

Bharat Electronics

BEL has been in a steady uptrend, forming higher highs and higher lows, reflecting strong bullish momentum. The stock has consistently taken support near its 20-EMA, reinforcing it as a key dynamic support zone. The Rs 415 level has acted as a stiff resistance on a couple of occasions in the past, but with improving momentum, a breakout above this zone looks likely.

The RSI is trending higher and nearing the 60 mark, indicating strengthening momentum, while the MACD remains in the positive zone with a bullish crossover. The ADX also suggests a healthy trend, supporting the potential for further upside. Hence, we recommend accumulating the stock in the zone of Rs 414-410 with a stop-loss of Rs 395. On the upside, it is likely to test the level of Rs 450 in the short term.

Do you see the beginning of a new leg of upmove in Yes Bank and BSE, which surged 10% and 14%, respectively, in the past week?

Both Yes Bank and BSE have shown strong technical breakouts, hinting at the beginning of a potential new leg of upmove. Yes Bank has given a downward sloping trendline breakout and negated its lower-high, lower-low structure, closing above its previous swing high of 23 made on June 2. However, with RSI extremely overbought at 83 and ADX at peak levels, some consolidation or profit booking cannot be ruled out before the next move higher.

BSE, too, has broken out of a downward sloping trendline, with DI+ crossing above DI– on the ADX, reflecting strengthening momentum. The stock took firm support at its 200-DEMA — a crucial long-term moving average that often acts as a base for trend reversals. With momentum and indicators aligned, BSE looks poised to break above Rs 2,390, it's previous swing high made on September 8 and extend its upmove.

Are the charts of PG Electroplast and Divi's Laboratories showing bullish setups?

Both PG Electroplast and Divi’s Laboratories are showing early signs of strength, though their setups differ in conviction. PGEL has recovered nearly 90 rupees from its recent low of Rs 497, but the price still trades well below its 100- and 200-day EMAs, keeping the broader trend weak. While indicators like DI+ crossing DI– and a bullish MACD crossover suggest improving momentum, follow-through buying above Rs 590–600 is needed to confirm a reversal; else, it could turn out to be a routine pullback.

Divi’s Laboratories, on the other hand, has given a downward sloping trendline breakout with strong volume support. The stock trades above key moving averages, with RSI rising and DI+ crossover indicating buyers in control, signalling a more convincing bullish setup.

Is the Nifty IT index showing signs of revival based on the weekly chart analysis?

Yes, the Nifty IT index is showing early signs of revival based on the weekly chart analysis. In the last week of September, the index formed a Hammer candlestick pattern, typically considered a bullish reversal signal when it appears after a downtrend. This pattern was followed by a strong upside move in the current week, with the index surging by nearly 5 percent, indicating a shift in sentiment.

Technically, the index has also moved above its 20-day and 50-day EMAs, reinforcing the short-term bullish bias. However, it is now approaching a crucial resistance zone — the downside gap area between 35,800 and 36,200, which was created on September 22. This gap zone is likely to act as a key hurdle in the near term.

Momentum indicators are also supportive, with the daily RSI rising steadily, suggesting improving strength. A sustained move above the gap resistance could confirm a short-term trend reversal and open up further upside potential for the index.

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