Nifty PSU sets sight on a new 52-wk high; 5 stocks that can rally up to 25%

After nine long years, the MACD on monthly chart for Indian Overseas Bank has crossed the zero line

The shares of Public Sector Banks were in limelight today, after yet another bank (Indian Overseas Bank) moved out fo the RBI's PCA framework. Now, only Central Bank of India is under the RBI watchlist. Manwhile, Indian Overseas Bank and Central Bank of India surged over 10 per cent each, while Bank of Maharashtra rallied 8 per cent.

The Nifty PSU bank index seems to be heading towards its 52-week high of 2,660 with maximum banks showing positive outlook for the coming trading sessions.

NIFTY PSU BANK

Likely target: 2,660

Upside potential: 5%

Whenever the Nifty PSU Bank index fell below the100-day moving average (DMA); the turnaround has been very significant since November 2020. The 100-DMA is currently positioned at 2,403 levels and the index is hinting a positive rally towards 2,660 level on the back of a strong recovery from a dip below its 100-DMA. However, there is a minor resistance at Rs 2,580. CLICK HERE FOR THE CHART

 

 

Indian Overseas Bank (IOB)

Likely target: Rs 28

Upside potential: 21%

Between July 2014 and April 2020, the shares of Indian Overseas Bank plummeted over 1,000 per cent. During this slowdown, there was not any sustainable consolidation. However, from the mid-2020 the stock has seen a bullish bias with “Higher High, Higher Low” formation, this positive stance may achieve higher levels of even Rs 35 – Rs 40 on a medium-term objective as Moving Average Convergence Divergence (MACD) crossed the zero line after nine years, according to the monthly chart. The immediate rally could be towards Rs 28-level, as per the daily chart. The closing basis support stays at Rs 18.  CLICK HERE FOR THE CHART

 

Central Bank of India (CENTRALBK)

Likely target: Rs 29.65

Upside potential: 22%

After the “Golden Cross” of the 50-day moving average (DMA) and 100-DMA with 200-DMA in the month of March 2021 and April 2021, the stock has not breached the support of 200-DMA, currently placed at Rs 18.95. As long as this support is held, the positive bias for the stock is likely to lead it towards Rs 29.65 level, which is the recent high, according to the daily chart. The major support is positioned at Rs 20, while an immediate support comes at Rs 22, which is its 100-DMA. CLICK HERE FOR THE CHART

 

State Bank of India (SBIN)

Likely target: Rs 500 and Rs 525 (after crossing 470 levels)

Upside potential: 7% to 11%

The stock price displays a consolidation range from Rs 470 to Rs 400, according to the daily chart. This range is likely to breakout upwards as the strength suggests a positive bias. Every healthy correction has seen buying momentum in respective support levels of Rs 440 and Rs 425 levels. An upside breakout above Rs 470 may see Rs 500 and Rs 525 levels on the immediate scale.  CLICK HERE FOR THE CHART

Canara Bank (CANBK)

Likely target: Rs 200

Upside potential: 17%

The shares of Canara Bank have crossed the major weekly resistance of Rs 175 level. The momentum is supported by the positive crossover of 50-DMA with 100-DMA symbolizing a bullish sentiment from market players. The bullish bias triggered a rally towards the Rs 200-mark, which is its 200-weekly moving average (WMA). The support stays at Rs 160. CLICK HERE FOR THE CHART

Bank of Maharashtra (MAHABANK)

Likely target: Rs 26.50 (after a close above 200-DMA)

Upside potential: 25%

Although, one can see a formation of “Death Cross”, on the daily chart, the pattern has not broken down. So, until the closing basis support of Rs 17 stays firm, the positive bias may negate the bearish pattern. On the flip side, if the stock manages to conquer and close above 200-DMA, placed at Rs 20.60 with elevated volumes, then the reversal breakout may see stock gaining nearly 25 per cent towards Rs 26.50 levels. CLICK HERE FOR THE CHART