DLF, Godrej Properties: Realty stocks that have gained in 2019

A Golden Cross breakout can trigger an upside rally in DLF

The Nifty Realty index has been one of the best performers in calendar year 2019 with a gain of around 19 per cent. The rise has been on account of steady fall in interest rates through the year and the implementation of the Real Estate Regulation and Development Act (Rera), which has helped clean up the sector. 

On its part, the Reserve Bank of India (RBI) has cut repo rate by 135 basis points (bps) in 2019 to 5.15 per cent -- a nine-year low. However, the central bank kept the rates unchanged in its recent policy review on December 5, which surprised most experts.

Here’s how the leading players in the real estate sector look on the technical parameters:

NIFTY REALITY: The index has witnessed selling pressure above Rs 290 levels as per the weekly chart. The Moving Average Convergence Divergence (MACD) has passed over the signal line upward with a positive crossover.

MACD, short for moving average convergence/divergence, is a trading indicator used in technical analysis of stock prices, created by Gerald Appel in the late 1970s. It is designed to reveal changes in the strength, direction, momentum, and duration of a trend in a stock's price. As true with most of the technical indicators, MACD also finds its period settings from the old days when technical analysis used to be mainly based on the daily charts.

The index trades above all the weekly moving averages (WMA) – 50, 100 and 200. It has consistently taken support of 200 WMA in last four months. CLICK HERE FOR THE CHART

DLF Ltd (DLF): The counter has made a “Golden Cross” as per the daily chart, but did not breakout above Rs 227. Simultaneous efforts have been made to conquer the selling pressure, but price is not able to move to higher levels. This has resulted in a consolidation in the range of Rs 224 – Rs 213 levels. The Relative Strength Index (RSI) has come out of the overbought region in the past few sessions (overbought and oversold are two different conditions that indicate potential profit booking in overbought region and buying in oversold region) and MACD has made a negative crossover. CLICK HERE FOR THE CHART

The relative strength index (RSI) is a technical indicator used in stock analysis. It is intended to chart the current and historical strength or weakness of a stock or market based on the closing prices of a recent trading period. The RSI is most typically used on a 14-day timeframe, measured on a scale from 0 to 100, with high and low levels marked at 70 and 30, respectively.

Godrej Properties Ltd (GODREJPROP): The upside momentum got lost when the price broke the support of Rs 940. Since the last 15 sessions, the stock has been hovering around its 200- day moving average (DMA). The RSI has made a negative crossover when the counter closed below Rs 892, which is its 200 DMA level. However, MACD trades with a positive crossover and has not seen much weakness till now. CLICK HERE FOR THE CHART

Oberoi Realty Ltd (OBEROIRLTY): The counter has broken out of a consolidation phase and moved towards Rs 570 levels in the past few sessions. As it moved above Rs 560, it faced some selling pressure in the range of Rs 575 – Rs 585 as per the daily chart. CLICK HERE FOR THE CHART

Sobha Ltd (SOBHA): A “Death Cross” has destroyed the upside sentiment of this counter, daily charts indicate. Every rise over the past few weeks have been met with resistance. Even the 100 DMA has made a negative crossover with 200 DMA. CLICK HERE FOR THE CHART