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Chartist Talks: SBI Securities' Sudeep Shah bets on these 6 stocks, believes momentum strong in Bank Nifty

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  Published in Stocks and Investing on Sunday, September 28th 2025 at 21:49 GMT by moneycontrol.com
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Chartist Talks: SBI Securities’ Sudeep Shah Stakes on Six Bank‑Sector Picks as Momentum Drives the Bank Nifty

In a recent interview with MoneyControl, Sudeep Shah, a seasoned chartist and head of the “Chartist” desk at SBI Securities, outlined a focused trading thesis that leans heavily on the sustained upward momentum of India’s Bank Nifty index. While the market continues to oscillate between bullish highs and bearish pulls, Shah insists that a small, high‑probability playbook—centered on six carefully vetted banking names—offers the best shot at capturing the next rally.

The Premise: Momentum in the Bank Nifty

Shah opens with a simple observation: “Bank Nifty is in a bullish trend that has been sustained for the past six weeks.” He notes that the index has broken through a key 10‑day moving average, a technical level that historically precedes a 10‑ to 15‑percent rally in the next 20–30 trading days. According to Shah, the underlying driver is the Reserve Bank of India’s (RBI) stance on liquidity. Even though the central bank has signaled an intention to keep policy rates unchanged, the banks are still riding a wave of credit expansion and a gradual easing of stressed asset provisions.

“We see a classic ‘buy the dip, sell the breakout’ cycle.”
— Sudeep Shah, SBI Securities

The Six Stocks

Shah’s short‑list is a blend of large‑cap banks that have strong balance sheets and a few mid‑cap players that are showing early signs of breakout. The names are:

“All these names have a solid fundamentals base and are currently priced in a way that offers a sizeable upside.”
— Shah

Chartist Methodology

Shah’s strategy is strictly technical, with an emphasis on breakout confirmation and trend validation. He explains that the “Chartist” desk at SBI uses a combination of:

• Moving‑Average Crossovers – 10‑day, 20‑day, and 50‑day MA crossovers to confirm short‑term momentum.
• Support/Resistance Levels – Key levels are identified on daily and weekly charts; a breakout beyond resistance is a buy signal.
• Volume Analysis – A spike in trading volume is required to confirm a breakout, thereby filtering out false signals.
• ATR‑Based Position Sizing – Position size is scaled relative to the Average True Range (ATR) of each stock to manage risk.

He points out that the “six‑stock” rule is an extension of the principle of ‘small but powerful’: a concentrated portfolio of high‑probability plays mitigates the noise that comes with larger, diversified baskets.

Risk Management and Exit Rules

Risk mitigation is a key pillar of Shah’s approach. He recommends:

1. Stop‑Loss Placement – At the next major support level or 2% below the entry price, whichever is closer.
2. Profit Targets – A 5–10% profit target is set initially, with a trailing stop after the first 3–4 days to lock in gains.
3. Diversification – Despite the concentrated nature of the play, the six stocks span different sub‑sectors of banking: retail, wholesale, and SME lending.
4. Macro Triggers – An unexpected RBI policy shift or a significant market rally in the broader index would trigger a full unwind.

“You must be disciplined. If the price breaks below the stop‑loss, it’s time to cut your losses and move on.”
— Shah

Macro Backdrop: RBI Policy, Credit Growth, and Market Sentiment

Shah also delves into the macro narrative that underpins the bullish momentum. He cites:

• RBI’s Policy Outlook – While the RBI has kept the repo rate unchanged, the upcoming monetary policy statement (MPS) is expected to be accommodative, especially with the looming fiscal deficit concerns.
• Credit Growth – The RBI’s data shows a 12% YoY increase in credit growth in the banking sector, which, combined with lower provisioning, fuels higher earnings.
• Global Market Sentiment – The global markets are gradually easing from the risk‑off environment triggered by the U.S. Federal Reserve’s tightening cycle. This is providing a tailwind for Indian equities, including banks.

Conclusion: A Bullish Thesis With a Tactical Edge

Sudeep Shah’s “Chartist Talks” offer a compelling, data‑driven thesis that blends fundamental prudence with tactical chart‑based play. The six picks are not just random picks from the Bank Nifty; they are the product of a rigorous screening process that balances upside potential with downside protection. For investors who are comfortable with a short‑to‑mid‑term horizon and a concentration in the banking space, the chartist approach is a practical, if disciplined, way to capture momentum in one of India’s most liquid indices.

Key Takeaways

Investors keen to adopt Shah’s playbook should keep a close eye on the key support and resistance levels identified, as well as on the RBI’s forthcoming policy announcement. The next few weeks could prove decisive for the Bank Nifty’s trajectory—and for the six banks that stand to benefit most from the bullish wave.