Nifty’s 25,880 wall: SBI Securities’ Sudeep Shah maps 26,000-26,200 path and flags two buys for next week

Sudeep Shah is the Head - Technical and Derivatives Research at SBI Securities

• Sustained follow-through move and hold above Rs 305–310 zone essential for sharp upmove in ITC
• Holding above Rs 21,510–21,500 with follow-through can extend rally in Hitachi Energy
• Sustained breakout above 25,880 may pave the way for sharp Nifty upside

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According to Sudeep Shah, Head - Technical and Derivatives Research at SBI Securities, the 25,850–25,880 band remains a key resistance area. "A sustained breakout above 25,880 could pave the way for further upside towards 26,000 and subsequently 26,200 in the near term, setting the stage for another attempt at higher levels," he said in an interview to Moneycontrol.

He is bullish on Cholamandalam Investment and Finance Company, and Cummins India for next week. "Cholamandalam Investment continues to trade above key short- and long-term moving averages, reinforcing the positive trend structure, while Cummins has closed above the upper Bollinger Band for two straight sessions, with bands widening, a sign of expansion" he reasoned.

Further, the price structure and indicators suggest LIC and Nykaa remain well-positioned for further upside, subject to follow-through and market stability, he said.

Can you confidently say that ITC has bottomed out, with the formation of a long bullish candle accompanied by strong volumes after a long time, and is now ready for the next upward move?

It is still too early to confidently conclude that ITC has bottomed out. While the recent long bullish candle supported by strong volumes is encouraging, it does not by itself confirm a trend reversal.

The stock continues to trade below its key short- and long-term moving averages, which suggests caution. Importantly, this bounce has emerged near the major long-term support zone of Rs 305–310. Momentum indicators are improving, with RSI rising from 13 to 42 and ADX appearing to peak. A sustained follow-through move and hold above Rs 305–310 zone is essential; a break below could revive weakness.

Considering the big gap-up trade well above the upper Bollinger Bands, do you expect a new leg of rally in Hitachi Energy India?

Hitachi Energy (POWERINDIA) has witnessed a sharp rebound after touching the lower Bollinger Band on January 18, followed by a strong gap-up close above the upper band on February 6, with bands now starting to widen which is a positive sign of expanding momentum.

RSI is rising and settled just below 70, indicating strong bullish strength with room for further upside. MACD has crossed above the zero line, and the stock trades above key short- and long-term moving averages. The bounce originated from the crucial Rs 21,510–21,500 support zone. Holding above this level with follow-through can extend the rally; a break may trigger gap filling.

What are your top two picks for the coming week?

Cholamandalam Investment and Finance Company

Cholamandalam Investment and Finance Company surged 6.28% on February 3 with a strong gap-up close and has been consolidating since then with the bulls defending higher levels. The stock found support near the Bollinger Bands midline, where fresh buying interest emerged. It continues to trade above key short- and long-term moving averages, reinforcing the positive trend structure.

Rising MACD histogram bars indicate strengthening bullish momentum. Overall setup suggests accumulation at higher levels and points to a potential continuation of the upward move. Hence, we recommend accumulating the stock in the zone of Rs 1,745-1,740 with a stop-loss of Rs 1,690. On the upside, it is likely to test the level of Rs 1,865 in the short term.

Cummins India

Cummins India has broken out above its Rs 3,883–4,173 consolidation range formed between January 12 and February 2, supported by a pickup in volumes. RSI has surged from 28 to settling above 60 at Friday’s close, signalling strong momentum revival. Rising green MACD histogram bars highlight increasing bullish strength.

The stock has also closed above the upper Bollinger Band for two straight sessions, with bands widening, a sign of expansion. Overall technical setup indicates sustained bullish momentum and potential for further upside ahead. Hence, we recommend accumulating the stock in the zone of Rs 4,375-4,355 with a stop-loss of Rs 4,240. On the upside, it is likely to test the level of Rs 4,675 in the short term.

Do you expect the Nifty 50 to defend the upper end of the decisive bullish gap formed on February 3 and begin a new rally next week?

The benchmark index went through an action-packed week, grappling with sharp swings amid elevated volatility. Nifty traded within a wide 1,662-point band, registering its largest weekly range since June 2024.

Technically, momentum indicators suggest a consolidation phase, indicating that the index may continue to move sideways before a clearer directional trend emerges.

From a levels perspective, the 100-day EMA zone of 25,500–25,550 is likely to provide immediate support, with the next cushion seen near 25,200. On the upside, the 25,850–25,880 band remains a key resistance area. A sustained breakout above 25,880 could pave the way for further upside towards 26,000 and subsequently 26,200 in the near term, setting the stage for another attempt at higher levels.

Do you see the Bank Nifty defending the falling support trendline in the coming week as well?

Bank Nifty closed the week at 60,120, logging nearly 3% weekly gains. The weekly chart formed a bullish candle with a long upper wick, highlighting heightened intraday volatility and selling pressure near elevated levels.

Structurally, the trend remains intact, with the index trading comfortably above all its key moving averages—reinforcing the durability of the medium-term uptrend. That said, momentum indicators and oscillators are beginning to lose steam, suggesting the possibility of a consolidation or range-bound phase as the market absorbs recent gains and waits for fresh cues.

Going forward, the 20-day EMA zone around 59,600–59,500 is expected to serve as the immediate and most critical support area. Sustaining above this band will be essential to preserve the prevailing bullish setup. On the upside, the 60,400–60,500 region continues to act as a stiff supply zone. A decisive breakout and sustained move above 60,500 could revive upside momentum, opening the door for a quick move towards 61,200, with potential extension towards the 62,000 mark in the near term.

Do you believe the panic selling in the Nifty IT index is over, with the index likely to take support at the 200-week EMA?

The Nifty IT index was among the hardest hit sectors this week, sliding nearly 7% as global AI-related concerns resurfaced. The trigger came from Anthropic’s launch of a sophisticated legal-focused AI tool, which intensified apprehensions that AI could increasingly replace or commoditise high-end software and consulting services.

Technically, the index has seen a clear breakdown. It is now trading below key short- and long-term moving averages and has confirmed a double-top neckline break, with the projected downside seen around the 35,050–35,000 zone. Momentum indicators have weakened further, with the RSI slipping below 40 and the MACD turning negative below the zero line. Unless the index decisively reclaims the 36,000 mark, the weakness is likely to continue. Traders should refrain from aggressive dip-buying and consider using rallies toward resistance as opportunities to sell until momentum improves.

What is your view on LIC and Nykaa after their recent sharp rally?

LICI has delivered a breakout above a downward-sloping trendline on the daily chart, while Nykaa has broken out above a key horizontal resistance zone. Both moves were backed by a strong surge in volumes, adding credibility to the breakouts.

Momentum indicators are also supportive. RSI in both stocks is above 70, reflecting strong bullish strength. On the ADX setup, DI+ has crossed above DI-, and rising MACD histogram bars indicate increasing bullish dominance. Overall, the price structure and indicators suggest both stocks remain well-positioned for further upside, subject to follow-through and market stability.