Mid-tier PSU banks' price volume chart hints at big upside in coming months

At 09:46 hrs IST, the Sensex was up 98.01 points or 0.13 percent at 75,516.05, and the Nifty was up 14.00 points or 0.06 percent at 22,981.70.

Indian benchmark indices have lately been trading with a bullish undertone. There is bullish structural confirmation in the daily and weekly charts of mid-tier PSU banks that are attracting strong investor attention.

Mid-tier PSU banking stocks have been witnessing strong accumulation and base formation near the support zone within a broader consolidation pattern, according to brokerage firm Nuvama Institutional Equities.

"The current formation suggests that the sector is poised for new highs, supported by strong relative outperformance and bullish momentum. The technical parameters of this sector have improved significantly in terms of price, volume, and trend confirmation. We recommend buying on dips," said Manav Chopra, Director - Technical Analyst at Nuvama Institutional Equities.

"The broader theme looks positive and hints at a significant upside unfolding in the coming months," he added.

Chopra's top picks from the basket are Indian Overseas Bank and Maharashtra Bank.

Indian Overseas Bank (IOB)

- Recommendation: Buy (in Rs )
- Current Price: 69.6
- Target Price: 97
- Stop Loss: 58
- Potential Upside: 45 percent

Weekly Chart showing candlestick pattern of IOB scrip | Source: Nuvama

Daily Chart showing candlestick pattern of IOB scrip | Source: Nuvama

Bank of Maharashtra (MAHABANK)
- Recommendation: Buy (in Rs)
- Current Price: 68.0
- Target Price: 100
- Stop Loss: 60
- Potential Upside: 48 percent

Weekly Chart showing candlestick pattern of Bank of Maharashtra scrip | Source: Nuvama

Daily Chart showing candlestick pattern of Bank of Maharashtra scrip | Source: Nuvama

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.