NMDC, Tata Steel, Vedanta: What do tech charts indicate for metal stocks?

Tata Steel, Vedanta and SAIL have seen sharp fall in their stock prices in the recent months.

Metal stocks have taken a heavy beating so far in the calendar year 2019 (CY19). Data shows Nifty Metal index has plunged 25 per cent (as of Tuesday's close) as against 0.50 per cent rise in the Nifty 50 index. 

Here's a look at what technical charts indicate for the Nifty Metal index and its key constituents going ahead - 

NIFTY METAL: The index is trading below 200-day moving average (DMA) since October 2018. The monthly chart shows a falling channel pattern, a scenario where higher highs, lower highs indicate selling pressure on every successive reversal. Currently, the lower falling trend line shows 2,250 level as immediate support. As the formation says, the counter may take support at lower falling trend line showing reversal towards upper falling trend line placed at 3,100, as per the monthly chart. CLICK HERE FOR DETAILED CHART VIEW
 
NMDC Ltd (NMDC): It is the only stock trading above its 200-DMA placed at Rs 99 with a positive sentiment. As the Golden Cross suggests an upside, one can stay bullish till the counter trades above the average. The 100-DMA is placed at Rs 105.50, which is acting as an immediate resistance. All major technical indicators relative strength index (RSI) and moving average convergence divergence (MACD) are trading in negative crossovers, a sign of  weak strength. A major breakout in the counter is expected only above Rs 110 level. CLICK HERE FOR DETAILED CHART VIEW
 
VEDANTA LTD (VEDL): A major breakdown is pushing this counter to a bearish phase. Although significant reversals can be noticed as per the daily chart, these reversals have been utilised for selling opportunities. If counter trades below Rs 145 for some more sessions, which is its crucial support, then it can see more selling pressure dragging it to Rs 130 and Rs 121 levels. The weekly chart shows a formation of Death Cross in progress, with all technical indicators substantially trading in negative crossovers. If this unfolds, the further downside is inevitable. CLICK HERE FOR DETAILED CHART VIEW
 
STEEL AUTHORITY OF INDIA (SAIL): As the Death Cross formulates on the weekly chart, the counter has lost nearly 20 per cent. Not only has it pushed the price down but forced technical indicators towards the oversold territory. The counter has witnessed strong reversal from Rs 34 – Rs 33 in 2016 and 2013, which seems the support levels for the current downtrend. One needs to be cautious around these levels, if the support gets breached then it would be difficult for the counter to revive from the expected selling pressure.  CLICK HERE FOR DETAILED CHART VIEW
 
TATA STEEL LTD (TATASTEEL): In the last 14 sessions, the counter has lost nearly 25 per cent witnessing a massive sell-off. The recovery seems fragile as RSI and MACD failed to recover with decent supportive volumes. The RSI was last seen in the oversold territory in Jan 2019, when price of Rs 430 stood as support. The counter has not only breached this support but is unable to find any ground to hold the steep fall. The overall trend suggests a rally towards Rs 300, if the counter does not witness any chart patterns. CLICK HERE FOR DETAILED CHART VIEW
 
HINDALCO INDUSTRIES (HINDALCO): Considering the overall patterns on the chart, Rs 160 seems to be the last support. One can look for positive bias as counter is witnessing sideways movement in the last five sessions, as per the daily chart. The RSI has risen above oversold territory however, MACD still trades with negative crossover. Going ahead, if MACD turns positive and heads towards zero line then price can see recovery. If in case, it breaches Rs 160, then it may fall towards Rs 130 and Rs 120 on a bigger outlook. CLICK HERE FOR DETAILED CHART VIEW