PSU Bank Index Analyzed: A Recent Shift

Key Points

• PSU Bank index dropped sharply, falling over 4% recently.
• Despite the drop, the index is still up 2.5% this month.
• Canara Bank, Bank of India, and Union Bank have seen large gains.
• Technical analysts predict further upside for these banks.
• Union Bank has a 16.3% upside target, Bank of India 26.6%.
• Canara Bank suggests a 19% potential gain for investors.

Yesterday, the Nifty PSU Bank index had a surprising day. It climbed to a record high of 9,093.65, but then quickly went down, dropping more than 4%. This brought the index down to 8,705.45.

As of midday today, January 21, 2026, the index was still down a little bit, at 8,788. The main Nifty 50 index was also down, dropping by 0.4%. Even though the PSU Bank index went down, it’s still doing pretty well overall, gaining about 2.5% so far this month.

This index has grown a lot in the last five months, jumping as much as 30%. This is much higher than the Nifty 50, which has fallen about 4% in January 2026, but still gained 2.5% over the same period.

Some specific banks, like Canara Bank, Bank of India, and Union Bank, have done particularly well. Their stock prices have increased by 41% to 48% over the past five months. A technical analyst thinks these banks could go even higher!

Drumil Vithlani, a technical analyst at Bonanza, is optimistic. He believes these banks have the potential to grow even more. Let’s look at what he’s saying about each bank.

Union Bank of India

Current Price: ₹172

Vithlani says Union Bank’s stock price is showing a pattern called a “symmetrical triangle.” This usually means the price will go up. He thinks it could reach a price of over ₹200 – that’s a jump of 16.3%!

He also says the stock is holding strong above ₹160, which is a good sign. The weekly chart shows the price is above important lines, confirming that the stock will likely go up.

Bank of India

Current Price: ₹158

Bank of India’s stock price has also shown a “rounding bottom” pattern, meaning people are starting to buy the stock again. Vithlani predicts it could reach ₹200 or more, a jump of about 26.6%.

The support level is between ₹130 and ₹135, meaning it won’t fall below this price. This makes it a good time to buy the stock, hoping it will go up.

Canara Bank

Current Price: ₹151

Canara Bank is currently on a strong upward trend. After breaking out of a “rounding bottom” pattern, the stock has climbed sharply. A small pause in the price is expected, making it a good time to buy when the price goes down a little.

Support is at ₹130, and resistance is at ₹165. If the stock breaks through this resistance, it could reach ₹175 or even higher – a jump of more than 19%!

“Investing in the stock market always involves risk, and it’s important to talk to a financial expert before making any decisions.”