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Can Jindal Steel, SAIL, NMDC bounce back? Here's what technical charts say

Avdhut Bagkar/Mumbai 06 Dec 18 | 07:50 AM


NIFTY METAL: The index has formed  'Head and Shoulder’ on weekly scale with a clear breakdown. The index is currently trading below the neckline of 3450 along with 100-day exponential moving average (EMA) at 3345. The chart pattern theoretically denotes negative trend, which means that it can slip further from the current levels.  The trend will reverse only of it can sustain above its 200-day EMA at around 3070 levels. The index currently hovering at 3,120 - above its recent low of 3092 and previous support level of 18 months at 3,062.

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JINDAL STEEL: The stock has been continuously trading below significant EMA from October. The stock breached crucial support of Rs 175 on closing basis. It made a rebound attempt but fell short due to lack of volumes. The 50-day (EMA) created pressure around Rs 182 – 184 levels, after fresh 52-week low on Wednesday. As a result, the trading range has now shifted lower to 172 – 175 levels.

NMDC: The monthly chart suggests that the stock needs to sustain above Rs 100 for a further upside. It faces resistance at Rs 150 and support at Rs 60 with crucial trades likely to come through around these levels. On daily and weekly scales, the major EMA 100 and EMA 200 indicate selling pressure around Rs 105 – 115 levels, respectively. As per technical indicators, the relative strength index (RSI) is making a negative crossover and is entering oversold region, while the moving average convergence/divergence (MACD) still trading in negative crossover.

SAIL:  The stock has been making new lows on the back of heavy volumes. The weekly formation shows descending triangle breakdown with every moving average becoming resistance for the reversal. The 100-day EMA is at Rs 69.30 and 200-days’ at Rs 67.80.  At the current levels of Rs 53, the stocks is retesting its fourteen months reversal low of Rs 52.85.

JSW STEEL: The stock is trading well above its 100-day (EMA) as per the weekly chart pattern. The last time it hit the 100-day EMA was two years ago when it traded around Rs 90 levels. The appreciation since then has been phenomenal, as the counter has jumped nearly four times. At current levels of Rs 305, the immediate support comes in at Rs 280 levels.

TATA STEEL: The overall scenario for the stock signifies lack of volume. The delivery volume has been dipping, weekly charts suggest. The crucial level for the scrip is at Rs 490, which is also the six-month reversal level. On the upside, it faces resistance at Rs 540.

HINDALCO:  The stock is currently holding at a major support of 100-day (EMA) on a weekly basis. In the last two months, there has been some buying at around Rs 215 - 220 levels, which has been accompanied by profit booking around the Rs 240 mark. The stock can now attract fresh buying if it closes above Rs 330 consecutively for the next five trading sessions.

VEDANTA:  This is a momentum stock that rises 5 -7 per cent easily with a rise in the indices. That said, it has been unable to attract follow-up buying. The overall trend indicates fresh buying coming in the range Rs 180 - 187 levels.

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Company Price Gain (%)
Reliance Inds.1,339.751.08
Bajaj Fin.3,432.650.76
Hind. Unilever1,783.500.62


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